JD Sports has agreed to sell Footasylum to an asset management group in Germany for almost £40m.
The Greater Manchester-headquartered retail giant has exchanged contracts with Aurelius Group after the Competition and Markets Authority ordered it to dispose of the company.
In a statement issued to the London Stock Exchange, JD Sports said it has "cooperated with the CMA throughout the divestment process, including ensuring that the purchaser was acceptable to the CMA and met certain key criteria set out within the final undertakings".
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It added that the sale, which is worth a total £37.5m, is expected to complete in the coming weeks.
The sportswear group also owns Tessuti and Go Outdoors while Aurelius recently acquired the parent company of Lloyds Pharmacy, McKesson UK.
JD Sports interim chief executive Kath Smith said: "I would like to sincerely thank the teams at AURELIUS and Footasylum who worked collaboratively with the CMA to agree this transaction. We wish both parties every success for the future."
JD Sports first agreed to buy Footasylum in March 2019 for £90m. However the deal has been the subject of prolonged scrutiny ever since and recently came to a head when both companies were jointly fined almost £5m for breaching rules around the merger.
The CMA said during two meetings, which took place on July 5, 2021, and August 4, 2021, then JD Sports CEO Peter Cowgill and Footasylum CEO Barry Bown "exchanged commercially sensitive information and then failed to alert or promptly alert the CMA". The companies were fined nearly £4.7m for the collective breaches.
Aurelius founding partner Dirk Markus said: "Footasylum has long been a staple of the UK high street and go-to shop for customers seeking high-end branded sportswear.
"As a standalone business, Footasylum has the potential to become an innovative retailer of sportswear and we are eager to unlock the company’s full potential.
"We believe that Aurelius is ideally placed to support Footasylum’s transformation, which will be backed by our extensive operational expertise within the retail, digital and wholesale channels."
Aurelius partner Tristan Nagler added: "Footasylum is a strong and trusted brand in the UK and we are very excited to begin this journey with a highly successful company.
"Throughout the acquisition process, we have been impressed by Footasylum’s ‘hyper local’ approach which seeks to serve the local community.
"We look forward to working with the company to harness its online offering and emulate its high street success."
Addleshaw Goddard advised JD Sports on its sale of FootAsylum. The 40-person AG team was led by partner Roger Hart and included David Auty, Michelle Davis-Ratcliffe, Emma Bowman, Samantha Jones and Simeon Laird.
Aurelius was advised on the transaction by Lincoln International (corporate finance and debt advisory), OC&C (commercial), Baker & Mackenzie; DLA Piper (legal), EY (tax).
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