Sports Direct acquires 80% stake of USC and Cruise Clothing
UK sports retailer Sports Direct has paid £7m for an 80% stake in West Coast Capital (USC) and Cruise Clothing, the luxury clothing businesses owned by retail tycoon Sir Tom Hunter.
Under the deal, Hunter, who has been involved with USC since 2004 and Cruise since 2010, will retain a 20% stake in both companies and continue to act as chairman – working in partnership with Sports Direct.
Sports Direct will provide a facility of up to £20m to enable the existing management teams of Cruise and USC to develop the businesses. It is anticipated that two new USC stores will open this autumn, in Swindon and Newbury.
Sports Direct also plans to build on existing supply relationships with major brands, while enhancing store merchandising and stock availability.
Hunter, who is also expected to provide strategic guidance to Sports Direct’s new premium lifestyle division, said that the deal “will transform the prospects for both USC and Cruise and our employees at a time of extraordinary turbulence in the High Street”.
He added: “I’ve known the Sports Direct team for many years and have huge respect for their talent and look forward to co-investing with them. Sports Direct has a truly exceptional track record in building partnerships with its customers and its staff.”
Meanwhile, Dave Forsey, chief executive of Sports Direct said: “We are pleased to be taking this opportunity to work with Tom and his teams in the premium and luxury sector of the market. While USC and Cruise will remain independent of Sports Direct, we will support the businesses with our operational expertise.”
USC currently has 38 stores across the UK and turnover in the 12 months to January 30 2011 was £7m, while Cruise has 10 stores in the UK and an annual turnover of approximately £20m.