CMA kicks off probe into JD Sports’ Footasylum acquisition

Third parties have until August 2 to comment and the CMA will reveal whether it has decided to refer the merger to a second phase of investigation on September 19.

The watchdog served its initial enforcement orders to both JD Sports and Footasylum shareholder Pentland, which is also the majority shareholder of JD Sports, in May.

The CMA is investigating whether JD Sports’ £90m acquisition of Footasylum could result in “a substantial lessening of competition in any market”.

JD Sports made the acquisition bid for Footasylum in March off the back of two profit warnings from the footwear specialist, which made its stock market debut in November 2017.

At the time of the bid, JD Sports executive chair Peter Cowgill said Footasylum was “very complementary to our existing businesses in the UK”.

He added: “We believe that there will be significant operational and strategic benefits through the combination of the very experienced and knowledgeable management team at Footasylum and our own expertise.”

The £90m cash bid for Footasylum valued the footwear specialist at a little over half of the £170m market cap it boasted when it floated in November 2017.

Footasylum was built up by JD Sports founders John Wardle and David Makin.