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As a subscriber you can listen to articles at work, in the car, or while you work out. Subscribe NowSpecialty retailer Finish Line Inc. said today that it is cutting ties with its underperforming Man Alive operations and will sell the business for about $7 million in cash.
The Indianapolis-based company said it will sell certain Man Alive assets and liabilities to Man Alive Acquisition LLC, which is controlled by Jimmy Jazz stores owner and operator Jimmy Khezrie. The agreement includes Man Alive’s 75 retail stores under the Man Alive and Decibel names as well as their trademarks and tradenames.
Leasehold interests and lease liabilities are also included in the deal, along with intellectual property.
Finish Line had a $13.2 million loss from Man Alive for the year ended Feb. 28 and said the sale will allow it to concentrate on its core operations.
As part of the agreement, Finish Line will receive up to $5 million at closing with the rest of the payments being made in 12 equal monthly installments. The first payment will be made on the first day of the first month after the acquisition’s completion.
The deal, which was approved by Finish Line’s board, is targeted to close early next month. Man Alive’s workers will be employed by Man Alive Acquisition LLC after the transaction is complete.
In addition, Finish Line said today that it expects its fiscal first-quarter loss from continuing operations to come in below analysts’ expectations. The specialty retailer anticipates a loss from continuing operations of a penny per share on sales of $267.2 million.
Analysts surveyed by Thomson Reuters, whose estimates generally exclude one-time items, predict profit of a penny per share on sales of $273.2 million.
Finish Line expects a quarterly same-store sales decline of 3.9 percent for its namesake stores and a 39.1-percent drop for Man Alive.
Same-store sales, or sales at stores open at least a year, are a key indicator of retailer performance since they measure growth at existing stores rather than newly opened ones.
The company, which announced plans to sell its underperforming Man Alive operations, is expected to report first-quarter results Thursday.
Finish Line has 685 of its namesake stores in 47 states and online.
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