<article>Fanatics Inc, the world&#8217;s biggest licensed sports merchandise retailer, said on Thursday it was expanding into China via a venture with private equity firm Hillhouse Capital Group, as the e-commerce platform considers a possible public listing.</article>

Fanatics Inc, the world&#8217;s biggest licensed sports merchandise retailer, said on Thursday it was expanding into China via a venture with private equity firm Hillhouse Capital Group, as the e-commerce platform considers a possible public listing.
Fanatics, the Softbank-backed firm with annual revenue that exceeds $3 billion, is betting on what it sees as untapped demand in China for sports equipment and clothing.
&#8220;China has been a market we followed for a while, and we&#8217;ve been meeting with multiple partners in China trying to figure out how we approach it in the best way,&#8221; Zohar Ravid, Fanatics&#8217; head of international corporate development, told Reuters.
&#8220;The interest overall in the country around European football, and American sports, is growing.&#8221;
Florida-based Fanatics operates online stores and sells products for more than 300 teams, brands and leagues from Manchester United and Nike to America&#8217;s National Football League.
The 50-50 joint venture with Hillhouse, Asia&#8217;s largest private equity firm, will be based in Shanghai.
It aims to localise operations including product design, sourcing and licensing to serve what Fanatics expects will be a multi-billion dollar market.
The plan includes leveraging Hillhouse&#8216;s expertise to build partnerships with e-commerce channels operated by Chinese tech giants Alibaba and Tencent, as well as selling in physical stores.
Fanatics now generates 10% of sales from outside the United States. The global licensed sports merchandise market is estimated to be worth $25 billion a year.
Ravid said the Chinese market was &#8220;grossly underserved&#8221; and could be worth $3 bilion-$5 billion a year.
The company, which has seen strong online sales growth during the pandemic, raised $350 million at a $6.2 billion valuation in August.
Asked about a possible initial public offering (IPO), Fanatics said in an emailed statement: &#8220;While an IPO is clearly an available path to us, there is no update on any timeline.&#8221;
Founded by Chinese billionaire Zhang Lei in 2005, Hillhouse invests in healthcare, consumer, technology and services firms, with a focus on Asia. It made early investments in Chinese tech giants Tencent, JD.com and Baidu.
&#8220;The local expertise is really, really why we&#8217;re relying on Hillhouse,&#8221; said Ravid.
Reuters

The 50-50 joint venture with Hillhouse, Asia's largest private equity firm, will be based in Shanghai.

SoftBank-backed sports retailer Fanatics enters China via JV with Hillhouse Capital

Bring stories like this into your inbox every day.

Sign up for our newsletter - The Daily Brief

SoftBank-backed sports retailer Fanatics enters China via JV with Hillhouse Capital

Start your deal-making journey now!

Bring stories like this into your inbox every day.

Sign up for our newsletter - The Daily Brief