<PAGE> 1
Securities and Exchange Commission
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): January 9, 1998
---------------------
GART SPORTS COMPANY
-----------------------------------------------------
(Exact Name of Registrant as specified in its charter)
Delaware 000-23515 84-1242802
- -------------------------------------------------------------------------------
(State or other juris- (Commission file (IRS Employer
diction of incorporation)number) Identification No.)
2000 Broadway
Denver, Colorado 80203
- ---------------------------------------------------------- --------------
Address of principal (Zip Code)
executive offices)
(303) 861-1122
- -------------------------------------------------------------------------------
(Registrant's telephone number, including area code)
Not Applicable
- -------------------------------------------------------------------------------
(Former name or former address, if changed since last report)
<PAGE> 2
ITEM 5. OTHER EVENTS.
On January 9, 1998, the Registrant issued two press releases attached
hereto as Exhibit 99.1, which is incorporated herein by reference, confirming
that the Registrant's acquisition of Sportmart, Inc., as described in the
Registrant's Registration Statement on Form S-4 (File No.
333-42355), was completed that date.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
(c) Exhibits.
99.1 Press releases issued January 9, 1998 by the
Registrant.
2
<PAGE> 3
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
GART SPORTS COMPANY
(Registrant)
/s/ Thomas B. Nelson
----------------------------------
Date: January 9, 1998 Thomas B. Nelson
Senior Vice President
<PAGE> 4
EXHIBIT INDEX
Exhibit No. Description
----------- -----------
99.1 Press releases issued January 9, 1998 by the Registrant.
<PAGE> 1
EXHIBIT 99.1
GART SPORTS/SPORTMART MERGER CREATES
2ND LARGEST SPORTING GOODS RETAILER IN US
DENVER, CO, Jan. 9, 1998 -- Gart Sports Company and Sportmart, Inc.
announced today the completion of their previously announced merger. Under the
final agreement, Sportmart has been acquired by Gart Bros. Sporting Goods, which
is a wholly-owned subsidiary of Gart Sports Company. With the acquisition
complete, Gart Sports Company becomes the second largest full-line US sporting
goods retailer, with 123 stores in 16 states and reported pro-forma combined
revenues for fiscal year 1996 of $718 million. The combined company, Gart Sports
Company, begins trading today on the NASDAQ National Market System under the
symbol GRTS.
Gart Sports Company officials also announced today the completion of a
$175 million Credit Facility with The CIT Group/Business Credit. The terms of
this agreement will provide the company with significant liquidity to operate
the current business and capitalize on strategic growth opportunities.
Following the completion of the merger, 72.5% of the common stock of the
company is held by former Gart Sports Company shareholders and approximately
27.5% is held by former Sportmart shareholders. Leonard Green & Partners, an
affiliate of the majority shareholder of Gart Sports Company, owns
approximately 61% of the outstanding shares of the new company.
Doug Morton will serve as Chairman, President and Chief Executive Officer
of the new Gart Sports Company. Sportmart corporate headquarters in Wheeling,
Illinois, will close and all corporate functions will be consolidated into
Denver, Colorado. Given the lack of store overlap, the company does not
anticipate any store closings or store level employee displacement as a result
of this merger.
"This merger brings together two highly innovative retailers with
synergies unsurpassed in the sporting goods industry today," said Doug
Morton. "Gart Sports' solid financial performance and strategic marketing
capabilities combined with Sportmart's market penetration and technological
strength, creates a formula for future success."
"With broader national presence and expanded distribution, Gart Sports
Company now takes a strong number two position in the industry," Morton said.
"For over 25 years, Gart Sports has been successful in garnering market share
with a combination of selection, value and service. Building on the solid
foundation Sportmart has established, we can now extend our proven approach of
superstore
<PAGE> 2
merchandising into high-opportunity markets such as California, the Upper
Midwest and the Pacific Northwest. While 1998 will certainly be a transitional
year, the combined companies will be well positioned in the sporting goods
industry with potential for growth."
Gart Sports, which is the leading sporting goods retailer in the Western
United States, will report another consecutive year of financial growth. Gart
Sports boasted a fourth quarter 1997 comparable store sales increase of 8.5%
and an increase in total revenues of 15.8%. For Fiscal year ending January 4,
1998, comparable store sales increased 5.6% and total revenues grew 11.7%.
Sportmart's comparable store sales declined 2% for the two month period of
November and December 1997 versus the prior year period.
Gart Sport Company's majority shareholder is Leonard Green & Partners, LP,
a Los Angeles based private merchant banking firm that specializes in
organizing, structuring and sponsoring management buyouts of established
companies. Leonard Green & Partners, LP currently has in excess of $500 million
in private equity capital under management. Leonard Green & Partners recently
completed the acquisition of Hechingers and the Builder's Square Division of
Kmart Corporation to create the 3rd largest US home center retailer with
revenues of approximately $4.5 billion. In addition, until recently
Leonard Green & Partners controlled Thrifty-Payless Corporation, the largest
drug store chain in the Western United States. The Thrifty Payless Corporation
was acquired by Rite-Aid Corporation for total consideration of $2.5 billion in
December, 1996.
"Safe Harbor" Statement under the Private Securities Litigation Reform Act of
1995: The statements which are not historical facts contained in this release
are forward looking statements that involve risks and uncertainties, including
but not limited to, product demand and market acceptance risk, the effect of
economic conditions generally, and retail and sporting goods business
conditions specifically, the impact of competition, capacity and supply
constraints or difficulties, the results of financing efforts, changes in
consumer preferences and trends, the effect of both companies accounting
policies, and weather conditions. The words "estimated" "believe" used in this
release as they relate to the company or its management are generally intended
to identify forward looking statements.
For additional information:
Contact: Doug Morton Tom Hendrickson
President, CEO, Chairman Chief Financial Officer
Gart Sports, (303) 863-2293 Gart Sports, (847) 520-0100 ext. 422
<PAGE> 3
EXHIBIT 99.1
GART SPORTS(NASDAQ: GRTS)/SPORTMART MERGER COMPLETED
CREATING 2ND LARGEST SPORTING GOODS RETAILER IN US
Denver, CO. Jan. 9, 1998--As previously announced today, Gart Sports
Company (Nasdaq: GRTS) has completed its acquisition of Sportmart, Inc.
(Nasdaq: SPMT). Former Sportmart shareholders received approximately 0.165
shares of Gart Common Stock for each share of Sportmart Common Stock or
Sportmart Class A Common Stock. Following completion of the acquisition, Gart
Sports has approximately 7,680,000 shares outstanding, of which approximately
2,181,000 were issued today to former Sportmart shareholders in exchange for
all outstanding Sportmart shares. Gart Common Stock commenced trading today on
the Nasdaq National Market under the symbol GRTS. Market makers include William
Blair & Co., Dain Rauscher Corporation, Olde Discount Corporation, Mayer &
Schweitzer Inc., Herzog, Heine, Geduld, Inc., Howe Barnes Investments, Inc. and
Sterne Agee & Leach, Inc.
For additional information:
Contact: Doug Morton Tom Hendrickson
President, CEO, Chairman Chief Financial Officer
Gart Sports, (303) 863-2293 Gart Sports, (847) 520-0100 ext.422
