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Monday, November 13, 2006

Dick's Acquires Golf Galaxy

Dick's Sporting Goods (DKS) is paying $18.82 cash per share to acquire Golf Galaxy (GGXY). This was just lumped in with DKS earnings release scheduled for today. The deal is valued in the $225 million range, and its market cap as of the close was $172.5 million.

Golf Galaxy currently operates 61 stores in 24 states, ecommerce websites and catalog operations, and generated $250 million in sales during the last 12 months ended August 26, 2006.

GGXY is trading up 17% at $18.32 in after-hours, and that is after trading down 1% to $15.65 in regular trading. With DKS valued at $2.5 Billion, this is a small and easy deal for the company to digest. DKS traded up 0.3% in regular trading to close at $48.92, but it traded up 3.2% to $50.51 in after-hours trading.

Will they keep the name as Golf Galaxy? They probably know that Dick's Galaxy and Dick's Golf probably aren't the two best names.

Jon C. Ogg
November 13, 2006
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