Dominique Patton
PARIS (Reuters) – French sports retailer Decathlon is buying specialist brands to expand, taking advantage of a post-pandemic industry restructuring that makes many companies attractive targets, Chief Executive Barbara Martin Coppola said.
The privately held company, known for its affordable sporting goods, bought German climbing equipment retailer Bergfreunde in January for “hundreds of millions” of euros, and the new division is aiming at bigger targets in Europe and further afield, Martin Coppola added.
“There are a lot of opportunities with companies doing very interesting things, but it may be challenging because of the market and the demand,” she told Reuters.
Demand for athletic clothing and equipment surged during the coronavirus pandemic, boosting sales, but many brands found themselves with excess inventory as people returned to normal work patterns.
Emerging brands such as running shoe specialists On and Hoka are challenging established brands as consumers seek specialized products for a range of sports.
Decathlon is strengthening its expertise in sports such as running, road cycling and climbing and is also increasing its marketing spend, including its first sponsorship deal for the Paris Olympics.
The company’s new Decathlon Pulse division will target acquisitions in luxury segments not already covered by its core business.
Martin Coppola, who has been in the position for just over two years, cited fitness as an area of focus and said Decathlon is already seeing strong growth in new business models such as second-hand sales and equipment leasing.
Decathlon, which generated sales of 15.6 billion euros ($16.9 billion) and profits of 931 million euros in more than 70 countries in 2023, has overhauled its strategy and cut the number of brands it sells from 80 to 12.
The company has 1,750 stores, with France being its largest market and it also has a significant presence in China.
Decathlon Pulse plans to spend €300 million on venture capital investments over the next four years, following €400 million it has invested in 21 companies since 2018, including the acquisition of Bergfreunde and French cycling equipment specialist Alltrix, as well as other smaller investments.
“Decathlon Pulse is an extension of what’s been done before, but with more tools and more acceleration,” Martin Coppola said.
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(Reporting by Dominic Patton and Keith Weir Editing)
