Bury-based JD Sports is set to buy a major American sportswear firm in a deal worth around £878m.

The business, which has its headquarters on Hollins Brook Way, has announced the proposed acquisition of Hibbett.

Headquartered in Birmingham, Alabama, Hibbett has 1,169 stores, as of February 3 this year, across 36 states.

Today, Tuesday, JD Sports said it entered into a binding agreement to acquire 100 per cent of the outstanding share capital of Hibbett, which is listed on American stock market index Nasdaq for a price of $87.50 per share in cash with its implied equity value amounting to £878m.

The business expects to fund the total consideration payable, and refinance Hibbett’s existing debt, through a combination of existing US cash resources of $300m and a $1bn extension to the group’s existing bank facilities.

The group says that on a "pro-forma basis, the combined revenues of JD and Hibbett in North America would be approximately £4.7bn".

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JD Sports Fashion Plc CEO Régis Schultz said: “We are delighted to announce the proposed acquisition of Hibbett.

"This acquisition is in line with our strategic priorities and is a very important transaction for our strategic and financial development.

"Strategically, it enhances our presence within North America and achieves our objective of strengthening our Complementary Concepts division.

"Hibbett’s footprint is highly complementary, adding a stronger presence in communities across South Eastern US, where we currently have a limited presence.

"It will also provide a stronger platform for the rollout of the JD fascia in the US."

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Mr Schultz added: "Financially, it accelerates our growth plans within the US and is expected to be earnings accretive from year one and before potential synergies are taken into account.

"It will also strengthen further our key brand partner relationships in the largest sportswear market in the world.

"Hibbett has a strong and experienced management team who we look forward to working with on this transaction and beyond as we welcome Hibbett into our family of North American retail fascias.”

The transaction is subject to customary conditions including Hibbett stockholder approval and clearance under the US Hart-Scott-Rodino (HSR) Antitrust Improvements Act.