Finish Line sheds specialty running stores division

Finish Line is cutting its losses related to its specialty running gear unit.



The sportswear retailer has sold its JackRabbit specialty running store division to CriticalPoint Capital LLC, a Los Angeles-based private investment firm.



The deal comes two months after Finish Line announced that it would explore strategic alternatives for the division, saying at the time that it believed “its long-term growth strategy and profitability improvement plans align with simplifying the business to focus on the Finish Line brand.”



While the retailer did not reveal the value of the sale, the deal is expected to close by the end of Finish Line’s fiscal fourth quarter, according to Finish Line.



JackRabbit, formerly known as Running Specialty Group, operates 65 stores in 17 states that sell running gear under brands such as Brooks, ASICS and Hoka One One. Overall, the business generated about $90 million in sales in the fiscal year ended February 2016, accounting for 4.8% of the company's total sales, Reuters said.



Under the agreement terms, CriticalPoint Capital will own the chain, all JackRabbit leasehold interests and lease liabilities, intellectual property, and the JackRabbit trademark and name. JackRabbit staff will be employed by an affiliate of CriticalPoint Capital, according to Finish Line.



"As we exit the running specialty business, we dedicate our entire focus to serving our core Finish Line and Finish Line Macy’s customers and driving profitable results that provide return to our shareholders," said Sam Sato, CEO of Finish Line.



Finish Line has approximately 970 Finish Line branded locations primarily in U.S. malls and shops inside Macy’s department stores.