Foot Locker deals expand footprint in U.S. Hispanic markets and Asia

Foot Locker is acquiring a pair of companies in deals worth more than $1 billion to expand the company's footprint in US. Hispanic markets and in the Asia-Pacific region.

The New York-based company said Monday it's buying athletic footwear and clothing company Eurostar Inc. for $750 million. Eurostar concentrates on Hispanic consumers, running 93 stores in California, Texas, Arizona and Nevada. The company had approximately $425 million in fiscal 2020 revenue.

Foot Locker also announced it's buying Text Trading Co., which owns and licenses a Japanese retailer called atmos, for $360 million. The transaction accelerates Foot Locker's Asia-Pacific expansion; atmos, with fiscal 2020 revenue of about $175 million, has 49 stores worldwide.

"This acquisition enhances our product mix and provides access to a customer base and store footprint that are both differentiated from and complementary to our current portfolio," Foot Locker Chairman and CEO Richard Johnson said in a statement. Both deals are expected to close late in the third quarter.

Foot Locker's annual sales hit an all-time high of $8 billion in 2019, but sales plunged last year when its 860 U.S. stores closed in the early months of the pandemic. Some also closed during the nationwide social unrest that followed the killing of George Floyd.

After the company's board approved a special $303 million pandemic "adjustment" to the company's financial accounting, Foot Locker CEO Richard Johnson and other top executives were rewarded with bonuses last year. Johnson, for instance,  reaped a $3.8 million cash bonus and his total annual pay package — $12 million — amounted to a 30% jump from what he had earned in 2019.

Most of Foot Locker's employees were less fortunate last year. The company furloughed nearly all of its workers without pay starting in late April 2020. It has since offered to hire most of them back.