Should the Dick’s Sporting Goods-Foot Locker Deal Face High Antitrust Concerns?

Senator Elizabeth Warren is asking the Federal Trade Commission and the Department of Justice to “closely scrutinize” Dick’s Sporting Goods’ proposed acquisition of Foot Locker, arguing that the $2.4 billion deal could raise prices, reduce competition, and lead to job losses.

The senator, as reported by CNBC, in a letter to the agencies wrote that it would create a “duopoly” in sneakers and other athletic footwear between the merged companies and their next largest competitor, JD Sports.

“The new giant would have significantly increased power to extract favorable conditions with manufacturers,” she wrote. “This could mean that independent retailers are at a disadvantage when it comes to negotiating with suppliers, which could give Dick’s and Foot Locker an incentive to engage in anti-competitive conduct to restrict suppliers from dealing with independent retailers.”

Warren wrote that the move comes after a series of mergers and acquisitions in the sector have already “led to market consolidation and the closure of thousands of independent shoe stores” — and as a Credit Karma survey shows, 54% of U.S. parents plan to sacrifice necessities, such as groceries, to ensure their children have what they need for the school year. Warren wrote, “Higher prices on athletic footwear could lead to further economic hardship for parents.”

Dick's, Foot Locker Acquisition: Detailed Breakdown

The deal, first announced in May, is expected to expand footwear to about half of Dick’s sales post-acquisition, up from 28% in 2024, Dick’s officials said on an analyst call when the merger was announced.

The deal should further increase its importance to vendors, particularly Nike, which accounted for 59% of Foot Locker’s sales last year, and a quarter of Dick’s. Other key shared vendors include Adidas, New Balance, Brooks, Ugg, and Asics — as well as hot upstarts such as Hoka and On.

Lauren Hobart, president and CEO for Dick's, said on the call, “With increased geographic reach and a broader portfolio of banners, we can serve new demographics through new formats, brand positioning, and an expanded international footprint. We're elevating our role as a partner to the world's most important brands, both established and emerging, helping them showcase product innovation and storytelling on a worldwide stage.”

Footwear has been a growing category for Dick’s, as its product allocations have improved with the addition of full-service footwear decks in 90% of stores.

Ed Stack, executive chairman and chief merchandising officer, expects Dick's will help Foot Locker further repair its relationship with Nike. He said brands overall are “really excited” about the potential merger.

He told analysts, “What we've been able to do from an operations standpoint, they think Foot Locker can benefit from that.”

Amanda Lewis, a former FTC mergers official and now a partner at Cuneo Gilbert & LaDuca, told CNBC the two retailers together would account for about 15% of the sporting goods market — a level she said usually doesn’t draw significant antitrust concern. She added that if regulators did impose conditions, they might require selling a small number of stores, a concession she believes would be less demanding under the current FTC leadership.