Dick’s Sporting Good confirms 2.4 billion dollar acquisition of Foot Locker

US sportswear chain Dick’s Sporting Goods has confirmed its intention to acquire footwear retailer Foot Locker in a 2.4 billion dollar deal. The duo have entered a definitive merger agreement holding an enterprise value of around 2.5 billion dollars.

By combining the companies, Dick’s is setting out to create a global platform within the sports retail industry. In a release, the company said that through Foot Locker’s already expansive international network, it will be the first time it has connected with global markets, thus growing its own footprint in the process.

Through this expanded reach, the duo also wish to strengthen relationships with brand partners while investing in future growth through omnichannel experiences, contributing to the goal of ultimately positioning the combined company for long-term growth. Much of this will be reflected through differentiated retail concepts, building on existing ideas like Dick’s House of Sport and Foot Locker’s Reimagined Concept stores.

For shareholders, Dick’s stated that it expects the transaction to be accretive to EPS in the first full fiscal year following the closing of the deal. It is predicted to deliver between 100 to 125 million dollars in cost synergies in the medium-term, achieved through procurement and direct souring.

Merged companies intend to grow respective footprints through differentiated retail

Foot Locker shareholders will elect to receive either 24 dollars in cash or 0.1168 shares of Dick’s common stock for each Foot Locker common stock. Based on the closing price of Foot Locker shares on May 14, this deal represents a premium of approximately 66 percent, a press release noted.

Dick’s intends to finance the acquisition, which is still subject to shareholder approval and other conditions, through a combination of cash-on-hand and new debt. The transaction is expected to close in the second half of 2025.

In a statement, Dick’s executive chairman, Ed Stack, said the company recognised a “meaningful opportunity for growth ahead” and “by applying our operational expertise to this iconic business, we see a clear path to further unlocking growth and enhancing Foot Locker’s position in the industry”.

The news fell simultaneous to the publishing of Foot Locker’s preliminary Q1 results, for the three months ended May 3, 2025, in which it also confirmed the takeover plans. The company, which operates around 2,400 retail locations across 20 countries, is expecting results “below our expectations as we experienced softer traffic trends globally”, CEO Mary Dillon said.

Comparable sales fell 2.6 percent year-on-year, while net loss is expected to amount to 363 million dollars, swinging the company into a loss after it reported a net income of eight million dollars in the year prior. Despite this, Dillon remained optimistic, stating: “We continued to manage our promotional levels and maintain inventory and expense discipline, and we have taken actionable steps to advance these efforts and remain nimble and well positioned in an uncertain macroeconomic backdrop."