The Lifestyle chain of sports shops has been sold to Stafford Holdings, a privately-held group that has shipping, hotel, fuel and property interests, in a deal valuing the group at close to €60 million.
Stafford Holdings, controlled by the family of its chairman Victor Stafford, is understood to be paying some €40 million up front for Lifestyle, which is the biggest chain of a sports stores in the State. The company plans to use its financial strength to expand the chain and will assume Lifestyle's debt of €19 million as part of the deal. The company had €57.4 million in its profit-and-loss account at the start of 2005.
The existing Lifestyle management, who stand to receive some €24 million for their 60 per cent stake in the business, have agreed to stay on after the sale.
The biggest individual beneficiary of the deal is Lifestyle managing director Andy Sharkey, owner of a 24 per cent stake in the business before the sale. Mr Sharkey led the management team that paid more than £15 million (€19.04 million) in 1997 to acquire the chain from Tesco.
Executive directors Anthony McEntree, Andrew Towell and John Mitchell each owned 10 per cent of Lifestyle. Another executive director, Harry Kenny, had a 6 per cent stake. ACT venture capital, which backed the original transaction, owned 36 per cent of Lifestyle. Non-executive director Brian Kearney held 2 per cent.
Another non-executive board member, Stewart Harrington, sold 25 per cent of the company to the other shareholders last January. He retained 2 per cent of Lifestyle before the deal.
Lifestyle has 71 stores, nine of which opened in the past 12 months. Its closest rivals are Elverys, which has 39 stores, and Champion Sports, which has 14 outlets. Champion sold 11 stores in 2004 to US group Footlocker.
Annual sales at Lifestyle were in the region of €38 million when Tesco sold Lifestyle's then portfolio of 49 stores to Mr Sharkey.
It had sales of €145 million in the year to October last and operating profits of €5.5 million.
The operating profit was down from €7.14 million in the previous year on sales of €118 million. Mr Sharkey said the main factor in the decline was higher property costs, as the chain leases its retail units. Staff costs were also rising.
Stafford Holdings is controlled by Taghmon Investments, whose biggest shareholder is Victor Stafford (62). Stafford Holdings chief executive Mark Stafford (30) and non-executive director Roddy Stafford (29) are the other Taghmon shareholders. Businessman Richard Keatinge is on the Stafford board.
Mark Stafford said Lifestyle Sports was an "ideal diversification vehicle" with excellent growth prospects. The Stafford company owns the Glenview Hotel in Co Wicklow, Campus Oil, Stafford Fuels, Aztec Properties and Stafford Shipping.
It had sales in 2004 of €232.78 million, pretax profits of €9.59 million and paid a €1.5 million dividend. It spent €9.35 million in 2004 buying the Clarke oil business and realised €31.7 million on a revaluation of its land.
