Los Angeles billionaire Ron Burkle’s Yucaipa Acquisition Co. is merging with online sporting goods retailer Signa Sports United GmbH to create an ecommerce platform with an enterprise value of $3.2 billion.
The deal raises $645 million for Berlin-based Signa Sports, with $345 million coming from West Hollywood-based Yucaipa and $300 million from investors through a private investment in public equity, or a PIPE.
Signa Sports is owned by Austrian billionaire Rene Benko, a 44-year-old real estate and retail investor who is listed at No. 496 on Forbes' list of the world's richest people with a net worth of $5.7 billion.
Yucaipa Cos. has completed deals valued at more than $40 billion since its founding in 1986. The investment firm focuses on the retail, manufacturing, distribution and hospitality industries. It is best known for its mergers and acquisitions of major grocery chains.
Yucaipa Acquisition sold 30 million shares and raised $300 million when it began trading last August as a special purpose acquisition company, or SPAC.
Signa Sports will list on the New York Stock Exchange. The stock's ticker symbol has not yet been decided.
Signa will use part of the proceeds to invest in its technology platform and buy Britain-based bicycle goods store Wiggle Ltd., the world's second-largest online bike retailer with estimated annual sales of $500 million.
Australian-based private equity firm Bridgeport Capital Management Pty Ltd., which currently owns Wiggle, will become an investor in Signa Sports as part of the deal with Yucaipa.
Signa Sports operates more than 80 web shops in 17 countries. The company expects adjusted earnings of $70 million on sales of about $1.6 billion in its current fiscal year that ends Sept. 30.