Wed, 24 Jun 2020 | BUSINESS SALE
JD Sports has bought back retail chain Go Outdoors after placing it into administration earlier in the week, which we reported on here. The company claims that the deal, which is said to be structured as a pre-pack administration sale, will preserve “as many jobs as possible” and honours existing agreements with suppliers.
Michael Magnay and Daniel Butters of Deloitte had been appointed as administrators for Go Outdoors, but it has now been reacquired by JD Sports, with the fee claimed to be £56.5 million. JD Sports says the company has a potential future within its group if it is “fundamentally restructured”.
The majority of staff will transfer as part of the pre-pack deal and the aim will be for most stores to continue trading, JD Sports says. All stores will initially remain open for a year, during which time JD Sports will attempt to negotiate more favourable terms with landlords.
It is unknown whether JD Sports determined the minimum deal price for Go Outdoors in relation to potential bids from competitors.
According to JD Sports executive chairman Peter Cowgill: "As a consequence of COVID-19, Go Outdoors was no longer viable as previously structured and would have absorbed capital at an unsustainable rate for the foreseeable future.”
"Having investigated all available options for the business, we firmly believe that this restructuring will provide Go Outdoors with a platform from which it can progress whilst remaining a member of the group.”
Michael Magnay, joint administrator, commented: "Like many high street retailers, Go Outdoors Ltd has been seeking to address a number of underlying business challenges in the current UK retail environment, which have been exacerbated by the impact of COVID-19.”
"This successful sale will provide Go Outdoors with an opportunity to restructure its business to secure its future for the long term.”
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