Acquisition

John David Sports PLC
3 May 2002


3 May 2002



                             John David Sports plc

 Proposed Acquisition of the Sport and Fashion Division of Blacks Leisure Group
                                      plc

Highlights of the Acquisition:

  • Conditional agreement reached for the Acquisition of the Sport & Fashion
    Division of Blacks Leisure Group plc which includes the retail fascias of
    First Sport, Active Venture and Pure Woman

  • Acquisition represents a significant step for JD Sports in building upon
    its position as the UK's leading specialist retailer of fashionable branded
    sports and leisure wear

  • Total consideration of £53.2 million

  • Cash required by the Company to complete the Acquisition to be funded from
    a new banking facility arranged for this purpose

  • Board of JD Sports believes that the Acquisition will be earnings
    enhancing, both before and after amortisation, in the next financial year

  • Acquisition will bring potential benefits to JD Sports including:
    significant cost savings, substantial cross-selling opportunities, increased
    geographic coverage and a broadened product offering

  • Acquisition is conditional upon the approval of shareholders of JD Sports
    and Blacks



  • Current trading at JD Sports since the Christmas trading statement on 15
    January 2002 is in line with current market expectations





John Wardle, Chairman of JD Sports, commented:  'We are delighted to have
concluded this agreement with Blacks for the acquisition of its Sport & Fashion
Division.  This acquisition will substantially increase the geographic coverage
of the Group and significantly broaden our product base.  The acquired stores
will operate as a stand-alone business and, simultaneously, it is our intention
to continue with our strategy of expanding the number of JD Sports stores to
beyond 300 via organic growth.



'We believe that the combined group will generate significant economies from
purchasing, warehousing, distribution and marketing.  We anticipate that we will
be able to bring operating margins for the acquired divisions closer to those
that we have historically achieved in JD Sports stores.'



Enquiries to:


John David Sports plc                                Tel: [phone]

John Wardle, Chairman
Barry Bown, Chief Executive
Malcolm Blackhurst, Finance Director

Investec Investment Banking                          Tel: [phone]

David Currie, Managing Director

Hogarth Partnership Limited                          Tel: [phone]

Andrew Jaques, Partner
Tom Leatherbarrow, Associate Director

Proposed acquisition of Blacks Sport & fashion division

Introduction

Further to the announcement by JD Sports on 11 March 2002 that it was in
preliminary discussions with Blacks to acquire Blacks Sport & Fashion Division,
the Board today announces that it has entered into a conditional agreement to
acquire Blacks Sport & Fashion Division for an effective consideration of £53.2
million (comprising the payment in cash at Completion of £11.0 million and the
assumption of an obligation on the part of the Company to procure the repayment
by Blacks Sport & Fashion Division of up to £42.2 million of inter company debt
immediately following Completion).  The cash required by the Company to complete
the Acquisition is to be funded from a new banking facility arranged for this
purpose.

In view of the size of the Acquisition in relation to JD Sports, the Acquisition
is conditional upon the approval of Shareholders which is to be sought at the
Extraordinary General Meeting. Given the size of Blacks Sport & Fashion Division
in relation to Blacks, the disposal of Blacks Sport & Fashion Division is
conditional upon the approval of Blacks' shareholders at an extraordinary
general meeting.  Completion of the Acquisition is therefore conditional upon
approval from both Blacks' and JD Sports' shareholders.

THE ACQUISITION

Terms of the Acquisition

JD Sports, through Athleisure, has conditionally agreed to purchase Blacks Sport
& Fashion Division for an effective consideration of £53.2 million comprising
the payment in cash on Completion of £11.0 million in respect of the entire
issued share capitals of the relevant companies that comprise Blacks Sport &
Fashion Division and the assumption of an obligation on the part of the Company
to procure the repayment by Blacks Sport & Fashion Division of £42.2 million of
inter company debt immediately following Completion.  This is subject to an
uncapped pound for pound adjustment either upwards or downwards for the amount
by which Blacks Sport & Fashion Division's actual net assets (excluding amounts
owed by Blacks Sport & Fashion Division to Blacks) as shown in a balance sheet
constituting part of the completion accounts are greater or less than £48.2
million.  No adjustment will be made either upwards or downwards unless the
amount of each balance sheet caption adjustment is greater than £25,000 and the
aggregate of all adjustments is greater than £250,000.

The Acquisition is conditional upon the approval of Shareholders which is to be
sought at the EGM and the approval of Blacks' shareholders at an extraordinary
general meeting convened for this purpose.  If the Resolution is passed at the
EGM and the Acquisition is approved by Blacks' shareholders, Completion is
expected to occur on the following day.

Background and reasons for the Acquisition

The Board of JD Sports believes that the Acquisition represents an exciting
opportunity for the Group to increase its critical mass within the retail sector
and consolidate its position as one of the leading sports fashion retailers in
the UK.  The Directors believe that the principal potential benefits of the
Acquisition to the Group will include:

  • significant cost savings as combined purchasing, warehousing, distribution
    and marketing result in enhanced economies of scale;
  • substantial cross-selling opportunities within the Enlarged Group as the
    new retail fascias will provide JD Sports with at least 185 new outlets from
    which to generate revenues from its own Carbrini and McKenzie brands in
    these stores;
  • increasing the geographic coverage of the Group.  The Board believes that
    there are approximately 100 locations within the Blacks Sport & Fashion
    Division portfolio where JD Sports does not currently operate; and
  • broadening the product base of JD Sports' portfolio through the addition
    of the First Sport, Active Venture and Pure Woman fascias.

The Directors believe that the value of Blacks Sport & Fashion Division to the
Company justifies the price being paid for it, and that the Acquisition will be
earnings enhancing, both before and after goodwill amortisation, in the next
financial year.  This statement should not be taken to mean that the future
earnings per share of the Enlarged Group will necessarily be greater than JD
Sports' historic earnings per share.

Integration of Blacks Sport & Fashion Division

It is the current intention of the Board to operate Blacks Sport & Fashion
Division as a stand-alone business and to continue trading under the First Sport
format.  The existing JD Sports fascias will continue to offer sports and casual
wear to the men's, women's and junior's market.  It is intended that First Sport
will focus predominantly on the men's and junior's markets whilst maintaining a
women's offering in selected stores. Active Venture and Pure Woman will continue
to focus on the premium lifestyle retail market.  The Enlarged Group will
operate all its businesses within an overall sports fashion base, however, it is
envisaged that each division will have a targeted product and brand mix,
allowing each fascia to maximise its trading potential.

Information on Blacks Sport & Fashion Division

Background and history

Blacks first entered the sports retail market in 1987 following the acquisition
of two small independent retailers.  These businesses were rebranded under the
First Sport name in 1990 and since then, Blacks' sport and fashion business has
evolved from being a small generalist retailer to a collection of well-known
premium retailers with a high quality sport and fashion offering.  Blacks Sport
& Fashion Division currently operates through three retail fascias: First Sport,
Active Venture and Pure Woman.

The business of Blacks Sport & Fashion Division

First Sport

First Sport has grown into a leading sports fashion retailer operating from 183
stores nationwide in high street, city centre and shopping centre locations.
The chain primarily targets a customer base of 16-24 year olds.  The product
base is predominantly sportswear but with a defined fashion orientation.  The
chain sells the major mainstream sports brands such as Adidas, Reebok and Nike,
in addition to more fashionable lifestyle brands such as Fred Perry and Kickers.

Active Venture

Active Venture is a premium fashion retailer targeting an older customer base of
20-30 year old, predominantly male clientele.  Active Venture opened its first
store in 1995 and currently has 24 stores in the UK.

The chain initially developed as a retailer of menswear, combining the sports
and outdoor brands sold in Blacks' other businesses.  The business currently
stocks brands such as as Timberland and Lacoste, and has recently introduced
newer brands to its offering including DKNY, Paul Smith Jeans, Polo Jeans, Henri
Lloyd and Dolce and Gabbana. Since 2000, Active Venture has broadened its
product offering to sell womenswear in selected stores.

Pure Woman

Launched in April 2000, Pure Woman is a retailer of technical sportswear and
casual wear, targeting style and health conscious women aged between 20-35 years
old. Pure Woman stocks a number of major mainstream sports brands such as Puma
and Nike in addition to more fashionable casual wear brands such as D&G, DKNY,
Miss Sixty and O'Neill. The business currently operates from two stores, one in
the Bluewater Shopping Centre in Kent and one in Southampton.



Financial information



The summary financial information set out below is extracted without material
adjustment from the Circular, which presents financial information on Blacks
Sport & Fashion Division for the two years ended 28 February 2002. Where an
accounting policy of the companies comprising Blacks Sport & Fashion Division
applied in the preparation of their audited financial statements differs from
that of the Company and would result in a material difference in the financial
information included in the Circular, then the accounting policy of the Company
has been applied and the relevant adjustments have been made in preparing the
financial information. In order to make a proper assessment of the financial
record of Blacks Sport & Fashion Division, investors are advised to read the
whole of the Circular and not rely solely on the summary financial information
set out below.

                                                                     Year ended 28             Year ended 28
                                                                     February 2001             February 2002

                                                                             £'000                     £'000
Turnover                                                                   176,972                   190,919
Operating profit                                                             8,315                     6,225
Profit on ordinary activities before taxation                                7,432                     5,251
Net assets                                                                  35,159                    36,991

Debt facility

Pursuant to the Facilities Agreement, Barclays Bank PLC has agreed, inter alia,
to lend up to £80 million to the Company, such sum to be divided between a
revolving loan facility of £40 million and a term loan facility of £40 million
for the purpose of funding the effective consideration payable in respect of the
Acquisition, associated acquisition costs and for general corporate purposes.
The term loan facility will be fully drawn down on Completion to fund part of
the effective consideration payable in respect of the Acquisition.  In addition,
the revolving loan facility will be partially drawn down on Completion to fund
the balance of the effective consideration payable in respect of the Acquisition
and associated acquisition costs.  Drawdown of funds by the Company pursuant to
this agreement is conditional, inter alia, upon the approval of both the
Shareholders at the Extraordinary General Meeting and of the shareholders of
Blacks at an extraordinary general meeting of Blacks.



Current trading and prospects



The Company released a trading statement on 15 January 2002 reporting continued
improved trading in the Christmas period.  Total sales in the six week period
ended 5 January 2002 increased by 21 per cent., including a like for like sales
uplift of 3 per cent..  The Company also reported a modest improvement in its
gross profit margin during the Christmas period.  Trading at JD Sports since the
Christmas period has been in line with market expectations.



In its trading statement of 16 January 2002, Blacks reported that Blacks Sport &
Fashion Division was experiencing an adverse trend in gross margin.  This trend
continued in the remaining period of the year ended 28 February 2002 and, as a
result, Blacks Sport & Fashion Division's operating profit for the year ended 28
February 2002 was significantly below that of the previous year and of market
expectations.  Trading at Blacks Sport & Fashion Division in the current
financial year continues to be difficult, with like-for-like sales and gross
margins in the eight weeks since the year end falling below the levels seen in
the corresponding period last year.



JD Sports has had considerable success in achieving operating margins at levels
above those of Blacks Sport & Fashion Division and the Board is confident that
under its control the operating margins of Blacks Sport & Fashion Division can
in time be raised to a level closer to those obtained by JD Sports.  In the
light of this and the potential benefits of the Acquisition referred to above,
the Directors are confident about the future trading and financial prospects of
the Enlarged Group.



Share Undertakings



The Acquisition is conditional upon the approval of Shareholders which is to be
sought at the EGM and the approval of Blacks' shareholders at an extraordinary
general meeting convened for this purpose.  David Makin and John Wardle,
directors of JD Sports, have irrevocably undertaken to vote in favour of the
resolution to be proposed at the EGM in respect of their own beneficial
shareholdings in JD Sports, amounting to 22,124,380 Ordinary Shares,
representing approximately 47.3 per cent. of the current issued share capital of
JD Sports. In addition, David Makin and John Wardle have agreed to use their
reasonable endeavours to procure that certain of their connected persons (being
trustees of family trusts where David Makin and John Wardle are personally
excluded as beneficiaries) vote in favour of the Resolution in respect of up to
3,973,160 Ordinary Shares, representing approximately 8.5 per cent. of the
current issued share capital of JD Sports. The trustees of these settlements
have indicated that they will vote in favour of the Resolution unless material
adverse factors become apparent before the EGM.



Extraordinary General Meeting



The Acquisition is subject to the prior approval of Shareholders at an
extraordinary general meeting to be held at 9.00 a.m. on 20 May 2002 at the
offices of JD Sports, Unit P14, Parklands, Heywood Distribution Park, Pilsworth
Road, Heywood, Lancashire  OL10 2TT, notice of which is set out in the Circular.
  The Resolution will be proposed as an ordinary resolution to approve the
Acquisition and any non-material variations to the Acquisition Agreement.



General



There will be a meeting for analysts with JD Sports' management at 09.15 a.m.
for 09.30 a.m. on 3 May 2002, at the offices of Investec Investment Banking, 2
Gresham Street, London EC2V 7QP.



The Circular, together with a form of proxy for use at the EGM, will be
despatched to Shareholders as soon as practicable.



Definitions



The following definitions apply throughout this announcement unless the context
requires otherwise:


'Acquisition'              the proposed acquisition of Blacks Sport & Fashion Division by the Company,
                           pursuant to the Acquisition Agreement


'Acquisition Agreement''   the conditional agreement dated 3 May 2002 between (1) Blacks, (2) Blacks
                           Holdings and (3) Athleisure relating to the Acquisition


'Athleisure''              Athleisure Limited, a wholly-owned subsidiary of J D Sports


'Blacks''                  Blacks Leisure Group plc


'Blacks Holdings''         Blacks Holdings Limited


'Blacks Sport & Fashion    the sport and fashion division of Blacks, comprising the entire issued share
Division''                 capitals of First Sport Limited, Active Venture Limited, Sport & Fashion Retail
                           Distribution Limited and The Sports Shop (Fife) Limited


'Board'' or 'Directors''   the directors of the Company as at the date of this announcement


'Circular'                 the circular to be sent to Shareholders, setting out further details of the
                           Acquisition and containing a notice of EGM


'Company'' or 'J D         John David Sports plc
Sports''


'Completion''              completion of the Acquisition, expected to take place on or about 21 May 2002


'Enlarged Group''          the J D Sports Group as enlarged by the Acquisition


'Extraordinary General     the extraordinary general meeting of the Company to be held at 9.00 a.m. on 20
Meeting'' or 'EGM''        May 2002, notice of which is set out in the Circular


'Facilities Agreement''    an agreement dated 3 May 2002 between (1) J D Sports, (2) Barclays Capital and
                           (3) Barclays Bank PLC and (4) Athleisure for loan facilities


'Group'' or 'J D Sports    J D Sports, its subsidiaries and its associated undertakings as at the date of
Group''                    this announcement


'Investec Investment       Investec Investment Banking, a division of Investec Bank (UK) Limited
Banking''


'Ordinary Shares'          ordinary shares of 5p each in the capital of the Company


'Resolution''              the ordinary resolution to be proposed at the EGM to approve the Acquisition


'Shareholder(s)''          holders of ordinary shares of 5p each in the capital of the Company


'United Kingdom'' or 'UK'' the United Kingdom of Great Britain and Northern Ireland





Investec Investment Banking, a division of Investec Bank (UK) Limited which is
regulated by the Financial Services Authority, is acting for JD Sports in
connection with the Acquisition and is not acting for any person other than JD
Sports and will not be responsible to any other person than JD Sports for
providing the protections afforded to its customers or for providing advice to
any other person in connection with the Acquisition.



This announcement is not intended to be an exhaustive summary of the
Acquisition.  The contents of this announcement have been extracted from the
Circular which contains full details of the Acquisition.





                                     -End-





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