Dick's Sporting Goods (NYSE:DKS) shares gained nearly 2% to about $225 in late-morning trading on Monday after the sporting goods retailer announced that it has completed its acquisition of Foot Locker.
Dick’s said the combined company will operate more than 3,200 stores plus e-commerce and digital businesses across 20 countries in North America, Europe, Asia, and Australia, plus a licensed store presence in Europe, the Middle East and Asia.
"Bringing together the strengths of both companies will help us return Foot Locker to growth while continuing to fuel Dick's momentum," Dick’s Sporting Goods CEO Lauren Hobart said in a statement.
"As a combined company, DICK'S and Foot Locker will create a global platform that will redefine the sports retail industry and unlock value for both companies, our brand partners, our teammates, our communities and our shareholders."
The company noted that the acquisition is expected to create between $100 million to $125 million in cost synergies in the medium term, primarily through procurement and direct sourcing efficiencies.
Dick’s anticipates the transaction to be accretive to earnings per share in fiscal year 2026.
Under the terms of the merger deal, each outstanding share of Foot Locker common stock was converted into the right to receive either $24 in cash or 0.1168 shares of Dick’s Sporting Goods common stock, based on the election of each shareholder.
The company said about 85.8% of Foot Locker shareholders elected to receive shares of Dick’s Sporting Goods, while 1.2% chose the cash option.