Major Shoe Retailer Acquired for a Whopping $2.4 Billion

WASHINGTON — Dick’s Sporting Goods has announced the acquisition of Foot Locker for approximately $2.4 billion. This move marks the second major buyout of a footwear company in recent weeks, highlighting the challenges retailers face amid ongoing trade tensions stemming from U.S. tariffs.

The acquisition will see Foot Locker operate as a standalone entity while retaining its various brands, including Kids Foot Locker and Champs Sports. Dick’s CEO, Lauren Hobart, emphasized the potential of this merger to create a comprehensive global platform that caters to the evolving needs of sports enthusiasts.

Both companies are led by women, with Hobart at the helm of Dick’s since 2021 and Mary Dillon having served as Foot Locker’s CEO since 2022. Dillon has initiated a turnaround strategy focused on enhancing relationships with major brands like Nike, particularly in basketball and sneaker culture.

This acquisition follows Skechers’ announcement earlier this month about being taken private by 3G Capital in a deal exceeding $9 billion. Concerns over the retail industry have intensified due to ongoing trade disputes, particularly affecting athletic shoe manufacturers heavily invested in Asian production.

Foot Locker has seen a 41% decline in stock value this year, compounded by shifting sales strategies from industry giants like Nike and Adidas. Meanwhile, approximately 97% of apparel and footwear sold in the U.S. is imported, primarily from Asia, leaving companies vulnerable to the impacts of tariff increases.

Foot Locker, headquartered in New York City, boasts a substantial global presence with around 2,400 stores in multiple regions, including North America and Europe. Last year, the company reported global sales of $8 billion, with Jefferies analyst Jonathan Matuszewski estimating that 33% of these sales derive from international markets.

The merger could enhance Dick’s market position, increasing its bargaining power with major sneaker brands. Neil Saunders, managing director of GlobalData, noted that Foot Locker’s existing market share would significantly benefit Dick’s.

Foot Locker shareholders will have the option to receive either $24 in cash or 0.1168 shares of Dick’s common stock for each share they own. The deal is expected to close in the latter half of the year, pending approval from Foot Locker shareholders.

In response to the market reaction, Dick’s stock fell over 10% before opening, while Foot Locker’s shares surged by more than 82%.