Nike set to swoop on Umbro
LONDON - Sportswear giant Nike is in talks to buy Umbro, the Cheshire-based sports company that supplies the England football team's kit, in a deal that could be worth over £230m.
Umbro's shares opened 4% lower yesterday following the England defeat, but soared almost 30% to value the company at £233m, after Umbro said it had received an approach from an unnamed party.
There was speculation that Sports Direct billionaire Mike Ashley, who has built a 15% stake in Umbro over the past two months, was the bidder. JJB Sports and Puma were also rumoured to be considering a bid earlier this year.
Nike's move comes just two weeks after Umbro issued a profits warning, following a huge downturn in sales of England replica kit.
Replica football shirts make up 90% of Umbro's business in the UK, which generates about 27% of group turnover.
Nike's takeover attempt follows a number of smaller deals aimed at expanding its portfolio of brands and sports. The American sportswear giant paid £149m for the Converse shoe brand in 2003, following deals for another shoe brand Cole Hahn, skate and snow brand Hurley and ice hockey business Bauer.
The takeover would give Nike, which already supplies kit to Arsenal and Manchester United, a huge presence in the Premiership. Umbro supplies kits for six Premiership teams, including West Ham and Birmingham.
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