Signa Sports accelerates restructuring program, to delist from NYSE

Signa Sports announced an acceleration of its strategic realignment and performance enhancement program in light of continuing macroeconomic headwinds, oversupply in the market and the company’s severe liquidity and profitability challenges. The operating environment for the company in the first nine months of FY23 and thereafter was characterized by a continuation of material disruptions which started in the second half of last year. Although some economic indicators across core markets have continued to improve slightly, the demand for the company’s products remains significantly below 2022 and pre-pandemic levels. In addition, inventory levels across the industry remain elevated as market participants still aim to clear excess inventory, resulting in a material adverse effect on the company’s gross margins and increasing negative cash flows. The company’s management has responded to ongoing market dynamics by undertaking a thorough review of the company’s operating model. Consistent with this initiative, and as a result of the challenging macroeconomic environment, a sustained oversupply in the company’s relevant markets and the resulting severe and materially adverse impact on the company’s liquidity and profitability situation, the company’s board has resolved together with management to implement a strategic realignment, performance enhancement and downsizing program for the company and all of its subsidiaries with the aim of returning the business to profitability and free cash flow breakeven as soon as possible. The performance enhancement measures under consideration include the streamlining and rightsizing of under-performing business units, the termination or winding down of non-performing assets as well as the opportunistic evaluation of disposals of non-core assets to strengthen the company’s distressed liquidity position and financial profile. In addition, also taking into account the limited liquidity and trading volume in the company’s publicly listed shares since the business combination in December 2021, the Company’s board has concluded that the benefits associated with being listed on the New York Stock Exchange do not justify the costs and demands of management’s time necessary to meet the company’s U.S. regulatory commitments. Consequently, the company’s board decided to immediately start the process to delist the company’s shares from the NYSE. It is expected that such delisting will become effective on or around October 22. After the NYSE delisting becomes effective, the company intends to promptly initiate the process for suspending its reporting obligations under the U.S. Securities Exchange Act of 1934, as amended. The company expects that the U.S. deregistration of its securities under the US Securities Exchange Act of 1934, as amended, will become effective prior to December 31, 2023. To support the accelerated realignment and performance enhancement program the board of directors will extend the scope of the duties of Torsten Waack van Wasen, CEO of Internetstores since February 2023, to become part of the company’s management team as chief performance officer for the group. After expiry of the contract of the company’s CEO Stephan Zoll in the first quarter of 2024, Torsten Waack van Wasen will follow him as CEO of the company.