Vista Outdoor’s uncertain and hotly debated plan to separate its outdoor and ammunition branches may finally be reaching a resolution after the company inked an agreement to sell Revelyst and amended its agreement to sell The Kinetic Group to Czechoslovak Group (CSG) a sixth time.
Investment firm Strategic Value Partners (SVP) and its affiliates agreed to buy Revelyst in an all-cash transaction based on an enterprise value of $1.125 billion. SVP woud take the company – which includes Foresight Sports, Bushnell Golf, Fox, Bell, CamelBak, Giro, and Simms Fishing – private in the deal that would close in January 2025.
The SVP acquisition of Revelyst is contingent on the sale of The Kinetic Group, Vista’s ammunition branch, to CSG. A sixth amendment to that deal, which is still subject to shareholder approval, increased the base purchase price from $2.15 billion to $2.225 billion. The agreement, now extended to Dec. 11, no longer includes an investment in Revelyst and reduces the cash consideration from $28 in cash per share to $25.75 in cash per share of Vista Outdoor common stock.
“Together, the CSG Transaction and the SVP Transaction represent an enterprise value of $3.35 billion for Vista Outdoor and will deliver an estimated $45 per share in cash to Vista Outdoor stockholders,” reads the press release announcing the deal.
Read The Daily’s primer about the Vista Outdoor sale saga here.
Vista Deals Give Investors “Light at the End of the Tunnel”
The price of shares of Vista Outdoor were up by more than 5% on Monday morning in response to the news – a positive sign that the deals will close, according to Anna Glaessgen, a senior analyst at B. Riley Financial who covers Vista Outdoor.
“I think that now that there’s a firm offer for Revelyst, certainly that’s a positive for shares,” Glaessgen said. “A lot of the investors have been looking at roughly a $45 takeout as something that they would be interested in. So with the CSG deal and the Revelyst deal coming together, it gives investors light at the end of the tunnel, or confidence in terms of getting to that $45 for sure.”
Some large shareholders previously indicated that they would vote against a deal with CSG and urged the board to renegotiate with MNC Capital, which offered $42 per share for the whole company. Vista Outdoor’s board of directors last month unanimously recommended shareholders vote in favor of the CSG deal and rejected MNC Capital’s final offer.
“A lot of the hesitation around the CSG deal in comparison to the prior offers by MNC to take out the whole company was that the ultimate valuation resulting from the CSG deal hinges on the performance of Revelyst as a standalone public company,” Glaessgen said. “And so given that you now have a take-private offer for the entire thing, it takes away that execution risk.”
SVP Plans to “Accelerate the Success” of Revelyst
Revelyst consolidated its real estate footprint over the past year as part of its “GEAR Up” transformation. It now operates Revelyst Adventure Sports in Irvine, California, Revelyst Outdoor Performance in Bozeman, Montana, and Revelyst Precision Sports Technology in San Diego. SVP plans to “propel margin expansion” across its brands.
“For almost a year, we closely followed Revelyst’s progress with this complex transaction,” said David Geenberg, head of North American corporate investments at SVP, in a statement. “During that time, Revelyst has gained share through a difficult period for consumer spending thanks to the strength of its leadership, its employees and efforts like GEAR Up. With this investment, we plan to put SVP’s full operating resources and network behind Revelyst to help accelerate the success of this market leader.”
Vista Outdoor co-CEOs Eric Nyman and Jason Vanderbrink said they were excited about both deals in a memo to employees.
“We are thrilled to have concluded the extensive process our Board and management undertook over the past two years to unlock the value of our Outdoor Products and Sporting Products businesses,” they said in the memo. “We are confident these transactions maximize stockholder value while also pursuing the best path forward for our company, stakeholders and valued employees.”
Eric Nyman. Photo courtesy of Vista Outdoor.
Nyman and Vanderbrink will receive $1.2 million in bonuses upon the completion of Vista’s strategic review. Four other executives at Vista Outdoor were granted $500,000 retention bonuses.
Kate Robertson can be reached at kate.robertson@emeraldx.com.
