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November 26, 2007 |
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ATHLETES WORLD: Forzani Group Discloses Acquisition Plans The Forzani Group Ltd. said Wednesday that it proposes to acquire 100% of bankrupt Athletes World Limited. The acquisition of Athletes World, Forzani said, will be financed through existing credit facilities. Forzani said that Athletes World will seek court approval of the transaction later this week. If that approval is granted, it is expected that the transaction will close at the end of November subject to the satisfaction of conditions customary in a transaction of this nature. Following the acquisition, Forzani intends to support the continuation of the restructuring of Athletes World under the Companies' Creditors Arrangement Act. In its most recently csompleted fiscal year, Athletes World generated US$186 million in revenues, and currently operates 138 stores. The acquisition of Athletes World represents a great opportunity for Forzani to add another recognized national banner. Forzani management believes that Forzani buying power, operational expertise and experience will provide the necessary platform on which to base Athletes World's long-term profitability upon its emergence from CCAA proceedings. In order to maintain Athletes World's positioning and identity, Forzani anticipates that Athletes World will, as it has with its other banners, maintain dedicated office staff, store employees and operational functions. Once the proposed acquisition is completed, senior management of Forzani will host a conference call to discuss the acquisition and its plans for the Athletes World banner. As reported in the Troubled Company Reporter on Nov. 7, 2007, Athletes World Ltd., Canadian unit of Bata Ltd., filed for protection from its creditors under the Companies' Creditors Arrangement Act with the Ontario Superior Court of Justice on Oct. 30, 2007. The company, which is losing money to competitors and facing thousand of dollars in tax claims, said it hopes to sell off its assets through the bankruptcy process. The company has been in negotiation with Michael Gold relating to the sale of the company's assets and had reached an agreement last May. However, Mr. Gold backed out on the deal on October 29 which led to the company's bankruptcy filing the next day. Athletes World owes about US$152 million, about US$115 million of which is owed to its parent company, Bata. About The Forzani Group The Forzani Group Ltd. (TSX: FGL) -- http://www.forzanigroup.com/ -- is Canada's largest national retailer of sporting goods, offering a comprehensive assortment of brand-name and private-brand products, operating stores from coast to coast, under corporate banners: Sport Chek, Coast Mountain Sports, Sport Mart, National Sports and Hockey Experts. About Athletes World Headquartered in Ontario, Athletes World Ltd. is a shoe retailer with over 100 stores in Canada. It is the only remaining Canadian retailer unit of Bata Ltd., -- http://www.bata.com/ -- a privately owned global shoe manufacturer and retailer. Bata is led by a third generation of the Bata family. With operations in 68 countries, Bata is organized into four business units. Bata Canada, based in Toronto, serves the Canadian market with 250 stores. Based in Paris, Bata Europe serves the European market with 500 stores. With supervision located in Singapore, Bata International has 3,000 stores to serve markets in Africa, the Pacific, and Asia, Finally, Bata Latin America, operating out of Mexico City, sells footwear throughout Latin America. Bata owns more than 4,700 retail stores and 46 production facilities. Total employment for the company exceeds 50,000. * * * As reported in the Troubled Company Reporter-Latin America on Nov. 8, 2007, Athletes World Ltd., Canadian unit of Bata Ltd., filed for protection from its creditors under the Companies' Creditors Arrangement Act with the Ontario Superior Court of Justice on Oct. 30, 2007, Marina Strauss writes for Globe and Mail. |
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