Accent Group has entered an agreement with Frasers Group to launch and operate Sports Direct in Australia and New Zealand for an initial term of 25 years.
Accent said it plans for an initial roll out of at least 50 Sports Direct stores plus an online store over the next six years, which the company said will require substantial investment.
The ASX-listed fashion group added that it sees an opportunity to open more than 100 Sports Direct stores over time.
Under the agreement, Accent will have access to Frasers’ portfolio, including Everlast, Lonsdale, Slazenger, Karrimor, USA Pro and Hot Tuna.
Accent will sell items from these brands through Sports Direct and the group’s other stores.
Moreover, the agreement involves Frasers increasing its shareholding in Accent by 5 per cent for $60.4 million.
This will result in Frasers having a total shareholding of 19.57 per cent in Accent and the proceeds from the transaction will provide the initial funding to build the Sports Direct business.
The companies also have a standstill agreement restricting Frasers to exceed a 26 per cent relevant interest in Accent’s shares for three years, following the completion of the new share issue.
Meanwhile, Accent will acquire Frasers’ discount online fashion marketplace, MySale. This will consolidate the British retail group’s Australian operations into Accent and expand Accent’s online presence.
“After extensive discussions, we are very pleased to announce a long-term strategic relationship with Frasers to open Sports Direct in Australia and New Zealand,” Daniel Agostinelli, Accent CEO, said.
“Sports Direct is one of the leading sporting goods retailing businesses globally. Frasers and Accent see a significant opportunity to bring a new and exciting global sports business to the Australian and New Zealand markets.”
Agostinelli signed a new employment agreement with Accent, committing to remain as CEO for another three years.