Acquisition expected to be earnings enhancing in first full year The proposed acquisition of Hibbett in the US for an implied equity value of $1,083m (£878m) at $87.50 per share or an enterprise value of $1,109m. The deal will be financed with cash and a £1,000m extension to the Group’s banking facilities. FactSet consensus suggests Hibbett will make FY25 PBT (Jan year-end) of $124m for the year to Jan’25 (JD Sports consensus FY25 PBT £925m), EBITDA of $182m, and EPS of $8.25. This implies a forward take-out PE of 10.6x ex synergies or an EV/EBITDA of 6.1x. It is anticipated that synergies will be c£25m and the deal will be earnings accretive in its first full year of ownership. The deal will help accelerate the Group’s growth in the US. On a pro forma basis, the combined revenues of JD and Hibbett in North America would be approximately £4.7bn and increase North America’s share of Group sales from 32% to approximately 40%. Hibbett has c1,169 Hibbett City Gear and Sport Additions stores (average size c.5,860 sq.ft. located in 36 states with the heart of the business being in Southeastern US. The deal is expected to complete in 2H. It is a class 2 transaction under UK listing rules and will need Hibbett shareholder approval as well as clearance under the US Hart-Scott-Rodino (HSR) Antitrust Improvements Act Reiterate BUY We view this as a reasonable price to pay for a business which will strengthen the complementary concept business in the US and give the Group a stronger platform from which to grow the JD Sports brand. Like the acquisition of Finish Line, this could turn out to be a well-timed acquisition at the bottom of a cycle, but there is always risk with any integration process. Shorter term, the focus is likely to remain on the weak consumer backdrop in both the US and UK and the lack of innovation coming from Nike which is impacting market growth. Longer term, we continue to believe JD has an attractive growth opportunity which is being undervalued by the market with the shares trading on an undemanding CY25 PE of 8.2x on consensus earnings. Our forecasts and TP are under review and are not yet updated for FY25 guidance given pre-Easter.