Rumor has it that DKS.US (DKS.US)'s $2.3 billion deal to acquire Foot Locker (FL.US) has entered final negotiations

The Zhitong Finance App learned that according to people familiar with the matter, sportswear retailer Dick Sports (DKS.US) is in in-depth negotiations to acquire major sneaker retailer Foot Locker (FL.US). Due to repeated tariff policies, Foot Locker's stock price has fallen by a cumulative total of 41% this year.

According to the terms of the deal being discussed, Dick Sporting Goods will acquire Foot Locker for $24 per share, and the deal could be announced as soon as Thursday, according to one of the people familiar with the matter.

Foot Locker closed at $12.87 on Wednesday, with a market capitalization of $1.22 billion. The stock surged more than 60% in after-hours trading in New York after news of the takeover negotiations broke. The deal valued Foot Locker at around $2.3 billion.

People familiar with the matter said that the two sides have yet to reach a final agreement, and details, including the schedule, may still change.

Although both chains rely heavily on sneaker sales, the merger will bring the two companies with very different business models together. Foot Locker has 2,400 stores around the world, mainly composed of small stores in cities around the world, while Dick Sporting Goods has about 800 large stores in the American suburbs.

Lauren Hobart, CEO of Dick's Sporting Goods, has been working to enhance the company's e-commerce capabilities while investing in physical stores. The company's sales growth has slowed in the last two quarters.

The company's shares fell 6.2% in after-hours trading in New York. The stock has a cumulative decline of 8.4% since this year, and its performance is lower than that of the S&P 400 mid-cap index.

Under CEO Mary Dillon's leadership, Foot Locker has always wanted to boost sales by revamping most of its store network and promoting member rewards programs. The company has been working to repair its relationship with Nike, which previously reduced cooperation with wholesale partners to promote its own sales channels.

Dillon, who became CEO in 2022, has an ambitious transformation plan for Foot Locker, including achieving annual sales of $9.5 billion by 2026. The transformation is difficult as American consumers cut back on non-essential expenses. In the fiscal year ending February 1, Foot Locker's revenue declined for the third year in a row to less than $8 billion.

Neil Saunders, managing director of GlobalData, said: “If the acquisition is successful, Dick Sports will take over a company that is still at a disadvantage, and Foot Locker's recovery is yet to fully unfold.”