Company Overview - Big 5, a sporting goods retailer based in the western U.S., has been sold for $112 million [1] - The company sells athletic shoes, apparel, accessories, and outdoor and athletic equipment for various sports and recreational activities [4] Transaction Details - The buyers are a partnership consisting of Worldwide Golf, another retailer in the sporting goods space, and private investment firm Capital Hill Group [2] - The deal is expected to enhance Big 5's ability to serve customers while maximizing value for stockholders, according to Big 5's CEO Steven G. Miller [3] Strategic Implications - The transaction combines Capitol Hill's financial resources with Worldwide Golf's specialty retail expertise, providing Big 5 with the necessary resources to strengthen its market position [3]

Core Viewpoint - Big 5 Sporting Goods Corporation has entered into a definitive merger agreement to be acquired by a partnership of Worldwide Golf and Capitol Hill Group in an all-cash transaction valued at approximately $112.7 million, including the assumption of about $71.4 million in credit line borrowings as of June 29, 2025 [1][4] Company Overview - Big 5 operates 414 stores in the western United States, offering a full-line product range in a traditional sporting goods store format averaging 12,000 square feet, including athletic shoes, apparel, accessories, and outdoor and athletic equipment [6] - The company aims to continue its legacy of providing quality sporting goods at exceptional value while maximizing stockholder value through this merger [3] Merger Details - Under the terms of the agreement, Big 5 stockholders will receive $1.45 per share in cash, representing a premium of approximately 36% to the company's 60-day volume weighted average price [2] - The transaction has been unanimously approved by Big 5's Board of Directors and is subject to stockholder approval, with an expected closing in the second half of 2025 [4] Strategic Implications - The acquisition combines Capitol Hill Group's financial resources with Worldwide Golf's retail expertise, providing Big 5 with long-term capital and strategic support to enhance growth and competitive positioning in the sporting goods retail sector [3][4] - Big 5 will remain an independent entity within the Capitol Hill Group portfolio, leveraging the combined resources of the partnership [3] Related Entities - Worldwide Golf is a leading golf retailer in the U.S. and Canada, operating over 95 stores and a strong e-commerce presence [7] - Capitol Hill Group is a private investment firm with diversified holdings, including retail, and has been active since 1992 [8]

Core Viewpoint - Big 5 Sporting Goods Corporation reported a decline in net sales and increased net loss for the first quarter of fiscal 2025, reflecting ongoing macroeconomic challenges affecting consumer discretionary spending [1][4]. Financial Performance - Net sales for Q1 2025 were $175.6 million, down from $193.4 million in Q1 2024, representing a decrease of 9.5% [1]. - Same store sales decreased by 7.8% in Q1 2025 compared to Q1 2024 [1]. - Gross profit was $54.3 million, down from $60.4 million year-over-year, with a gross profit margin of 30.9% compared to 31.2% in the prior year [2]. - Selling and administrative expenses decreased by $0.6 million year-over-year, but as a percentage of net sales, it increased to 40.3% from 36.9% due to lower sales [3]. - The net loss for Q1 2025 was $17.3 million, or $0.78 per basic share, compared to a net loss of $8.3 million, or $0.38 per basic share, in Q1 2024 [4]. - EBITDA was negative $12.0 million for Q1 2025, worsening from negative $6.5 million in the prior year [5]. Operational Insights - The company ended Q1 2025 with $30.9 million in borrowings under its $150.0 million credit facility and a cash balance of $3.9 million [7]. - Merchandise inventories increased by 6.5% compared to the prior year, indicating earlier timing of receipts [7]. - The company currently operates 414 stores, having closed eight stores in Q1 2025, with plans to close approximately seven more stores during the fiscal year [9]. Future Guidance - For Q2 2025, the company expects same store sales to decline in the low to mid-single digit range compared to Q2 2024, anticipating continued macroeconomic headwinds [8]. - The expected net loss per basic share for Q2 2025 is projected to be between $0.75 and $0.90, with no tax benefit anticipated for the period [8].