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NATIONWIDE DSNRT REPORT - The time for a merger between Gart Sports and The Sports Authority may be at hand. Now that barriers to the deal, which was first proposed four years ago, no longer apply, reasons to move forward make sense now more than ever.
For one, the combination of Gart and The Sports Authority (TSA), the two largest operators of fullline sporting goods stores, would create a company with annual sales of $2.4 billion and 377 stores in 42 states-an achievement neither could reach on its own through organic growth. In addition, there is very little overlap between Gart's 179 stores and TSA's 198 stores, except in large attractive markets, such as Chicago and Southern California, where the combined company would benefit from increased store density.
The deal makes sense in other markets, too. In states where overlap is minimal, stores could be converted to the name of the dominant retailer in the marketsomething Gart has done in the past following its acquisition of Sportmart and Oshman's Sporting Goods. For example, the two stores Gart operates in Florida under the Oshman's name could be converted to TSA stores since it already operates 40 units in Florida. Conversely, TSA's two stores in Texas could be converted to the Oshman's name since Gart operates 28 stores under that name in Texas.
Beyond the beneficial store operations changes, systems integration could be presumed to go smoothly since both companies use JDA...