Dick’s Sporting Goods allegedly interested in going private

Thursday, 08 January 2015
Dick's Sporting Goods Inc is holding early-stage conversations with a handful of buyout firms about going private, according to people familiar with the matter, unveiled Reuters Wednesday.

On the wake of the rumours, shares of Dick's Sporting Goods rose as much as 13.5 percent to 55.88 dollars, giving it a market value of roughly 6.7 billion dollars. Before this hike, and at Tuesday's close, the stock had fallen 15 percent in the last 12 months, compared with a 6 percent rise for the Standard & Poor's 500 Sector Discretionary index, highlight data compiled by Reuters.

On a positive note, revenues at Zumiez has climbed 14.4 percent to 143.4 million dollars in the five weeks to January 3.Same-store sales climbed 8 percent, compared to a 2.4 percent decline in the year-ago period. Analysts on Wall Street had projected comparable sales growth for the full quarter of 4.1 percent.

Elsewhere, Deb Shops on Wednesday won court approval to launch going-out-of-business sales that will culminate with the closing of nearly 300 stores, reported the ‘Financial Times’. An auction Tuesday ended in a deal with liquidators Hilco Merchant Resources LLC and Gordon Brothers Retail Partners LLC, which will sell off the final inventory, furniture, fixtures and equipment, said Laura Davis Jones, a lawyer for the company.

Also shutting down is teen fashion chain Wet Seal, which has announced it will close 338 stores — two-thirds of the company’s retail locations, affecting 3,695 employees.

On the corporate news chapter, lululemon athletica inc. (NASDAQ:LULU) announced Wednesday that Stuart C. Haselden has been named as Chief Financial Officer, effective as of 2, 2015. “Looking at the world-class team that Laurent has assembled, I’m excited to assume this role and contribute to lululemon’s growth. Additionally, I look forward to working with our investor and shareholder community”

Welcoming the new CFO and commenting on his hiring, the yoga apparel company´s CEO, Laurent Potdevin said:“I’m very pleased to welcome Stuart to our senior management team. Stuart’s extensive background in financial management with global apparel retailers is a perfect fit for lululemon. I’m confident that his broad capabilities will strengthen our ability to build on our momentum as we develop our international footprint and create long-term, sustainable value.”

Finally, and following a rocky start of the year, analysts at Zacks Equity Research wonder whether Michael Kors would gain share but compromise its margins. “We believe that the company’s margins and comps hover at extremely high levels which may be hard to sustain in the long run. Increasing investments across board will run down the benefits from favourable product mix and overseas expansion leading to fall in margins. Further, the company’s aggressive promotions will dent margins.”

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