Billionaire Burkle’s SPAC Buys European Sporting Items Retailers

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Billionaire grocer and co-owner of the Pittsburgh Penguins, Ronald Burkle, enters the sporting goods business.

Burkles Yucaipa Acquisition, a SPAC holding $ 345 million from an initial public offering in August, has signed a deal to merge with Signa Sports United, a Germany-based online sporting goods retailer, according to a statement from Signa. The deal, valued at $ 3.2 billion for Signa, includes the simultaneous purchase of WiggleCRC, an English sporting goods retailer specializing in bicycles.

“Admission as a publicly traded company enables us to continue to gain market share in Europe and to accelerate our expansion in the US and internationally, while at the same time scaling our platform solutions,” said Stephan Zoll, CEO of Signa, in the press release.

In addition to using its SPAC funds in the transaction, Burkle is anchoring the private $ 300 million investment in public equity financing (PIPE) that will bring additional cash to fund the transaction. “Ron Burkle is personally investing $ 50 million in the PIPE, along with some of the world’s best institutional shareholders in the public market, and the existing shareholders are transferring 100% of their equity,” said Ira Tochner, chief operating office of Yucaipa SPAC, in Prepared Notes for an investor call the deal.

The combined companies generate 86% of their sales in Europe – and only 9% in the US – with 63% of sales coming from bicycles, 17% from tennis and the rest from team and outdoor sports, according to the investor presentation.

Yucaipa is one of 164 SPACs with sports figures or with a focus on sports companies. The blank check sector has slowed dramatically in the past few weeks due to regulatory crackdowns and increasing reluctance from investors to support deals.

Yucaipa SPAC’s shares rose about 8 cents Friday morning to $ 9.92 per share. Signa will take over the listing of Yucaipa on the New York Stock Exchange in the second half of the year upon completion of the transaction.

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