Collegiate Pacific to Purchase Remaining Sport Supply Shares…Again

Sep 22, 2006 4:07 AM  By

If at first you don’t succeed, try again. That’s what Collegiate Pacific intends to do by offering once again to acquire the remaining shares of Sport Supply Group it does not currently own. It intends to pay approximately $24 million in cash, or $8.80 per share.

In November 2005 the two Dallas-area companies, both of which sell sports equipment to schools, institutions, and organizations, terminated a merger agreement they’d signed two months earlier. (See “Collegiate Pacific/Sport Supply Group Merger Falls Through.”) But that didn’t mean the two companies severed ties. Instead, Collegiate Pacific bought 1.66 million shares of Sport Supply for $5.55 per share. The shares amounted to about 19% of Sport Supply’s outstanding stock and upped Collegiate’s stake to 72% from 53%. Collegiate Pacific had purchased a majority share in Sport Supply Group from Emerson Radio Corp. in July 2005 for $32 million in cash.

The merger is subject to the approval of the stockholders of Sport Supply and the obtaining of financing. The agreement has already been approved by the board of directors of Sport Supply, upon the recommendation of a special committee of the board of directors. Collegiate expects to finance the merger through borrowings under a new credit facility with Merrill Lynch Business Financial Services.

In other Collegiate news, chairman/CEO Michael Blumenfeld says he intends to retire before the end of the calendar year, after the Sport Supply transaction is completed. He’ll remain involved with the company in a consulting capacity. Collegiate president Adam Blumenfeld, will become CEO, and Sport Supply president Terry Babilla will become president/chief operating officer.