INDIANAPOLIS – Finish Line Inc. said Monday it agreed to pay about $1.46 billion (euro1.09 billion) for footwear and accessories retailer Genesco Inc., which recently rejected a lower offer from Foot Locker Inc.
Finish Line agreed to pay $54.50 per share, or about 6.8 percent higher than the $51 per share price offered two weeks ago by Foot Locker. The Finish Line offer marks a premium of 9.8 percent over Genesco's closing price of $49.60 Friday.
Genesco previously rejected the Foot Locker bid, saying it was not in the best interest of shareholders. The company had been reviewing alternatives to increase its stock price. It had about 26.8 million shares outstanding as of May 5.
The acquisition requires shareholder and regulatory approvals.
Finish Line expects the deal to add to earnings in the first year after closing, which it expects in the fall. The company plans to finance the move primarily with debt.
Finish Line, based in Indianapolis, said combined sales are about $2.8 billion (euro2.09 billion) from 2,870 retail stores in the United States, Canada and Puerto Rico.
Genesco Inc., a Nashville-based specialty retailer, sells shoes, hats and accessories in more than 2,000 retail stores in the United States and Canada under several store names, including Journeys, Johnston & Murphy, Underground Station, Hatworld and Lids.
Upon the close of the transaction, Genesco would become a subsidiary of Finish Line, but would continue to maintain its operations in Nashville.