Sports retailer John David Group yesterday swooped on stricken rival Allsports in an £18m store and stock deal.
Private equity and trade interest in Britain’s fourth-largest sports retailer had fallen away.
Retail entrepreneur Mike Ashley is thought to have walked away last week but Ashley has been building a stake in John David Group, suggesting he may be eyeing a bigger deal.
John David Group finance director Brian Small said: “There was a defensive aspect. We wouldn’t have wanted a sportswear retailer the size of Allsports falling into the hands of the competition.”
He added: “We believe in the (sportswear) market; it is not washed out. It has been a very good business in the past and we look forward to taking it forward.”
John David Group acquired 178 Allsports outlets as well as its remaining stock at cost price. Allsports collapsed into administration in September and administrators had already closed 92 loss-making stores and making more than 1,000 full and part-time staff redundant last month.
John David Group, whose main chain is JD Sports, will review the stores, and up to 60 are likely to close next year. Further head office redundancies are also likely.
Allsports will operate as a separate chain and will continue to be run by managing director Jeremy Bradburn. However, high-margin own-label JD Sports brands such as McKenzie and Carbrini as well as branded fashions will be introduced.
Analysts were cautious given John David Group’s poor track record of acquisitions, such as the troubled £52.3m First Sport deal in 2000, which it later abandoned running as a separate chain. Recent trading has also been weak with like-for-like sales down 6.8 per cent in the nine weeks to 1 October.
According to unaudited accounts for the year to 31 January Allsports made an operating loss of £800,00.