Vista Outdoor splits in two for $3.4 billion sale
Vista Outdoor Inc. has entered into a definitive agreement with funds managed by Strategic Value Partners, LLC, and its affiliates (SVP), a global alternative investment firm with approximately $19 billion of assets under management, to sell Revelyst in an all-cash transaction based on an enterprise value of $1.125 billion.
In connection with the SVP transaction, Vista Outdoor also entered into an amendment to the merger agreement with Czechoslovak Group a.s. (CSG) to acquire The Kinetic Group, increasing the purchase price for the Kinetic Group to $2.225 billion.
Vista Outdoor is the parent company of more than three dozen renowned brands that design, manufacture and market sporting and outdoor products. Brands include Bell Helmets, Fox Racing, CamelBak, Bushnell Golf, Foresight Sports, Camp Chef, Giro, Simms Fishing, QuietKat, Stone Glacier, Federal Ammunition, Remington Ammunition and more.
The SVP deal is subject to the completion of the CSG transaction. Together, the sale represents an enterprise value of $3.35 billion for Vista Outdoor and will deliver an estimated $45 per share in cash to Vista Outdoor stockholders.
“The board has worked tirelessly to deliver maximum value to its stockholders, and we are pleased to have reached this agreement with SVP and CSG, which will help us achieve that objective,” says Michael Callahan, Vista Outdoor board of directors chairman. “The board engaged in a thorough process to identify the best avenues to unlock value – and through these two separate, but contingent, transactions with SVP and CSG, we have identified a path that reflects the true strength and potential of both Revelyst and The Kinetic Group.”
David Geenberg, head of SVP’s North American corporate investment team, comments, “We are strong believers in the Revelyst story and the potential of this business. With a portfolio of diverse, market-leading brands in the outdoor industry, Revelyst has an unparalleled opportunity to capture market share through its exceptional consumer focus and strengthen its platforms through its operational and supply chain enhancements. We are happy to partner with the strong leadership team at Revelyst to help unlock its full potential with SVP’s resources.”
“We look forward to creating long-term value at The Kinetic Group as part of the CSG portfolio,” says Michal Strnad, CEO and owner of CSG. “The Kinetic Group has a deep heritage of delivering high-quality, innovative products and we will provide significant resources, investment and expertise to continue growing the business and serving its customers with leading ammunition products. We are confident CSG’s acquisition of the Kinetic Group is the best outcome for Vista Outdoor stockholders, employees of the Company and the American economy.”
The SVP transaction has been unanimously approved by the board and is expected to close by January 2025, subject to the completion of the CSG transaction, as well as the receipt of necessary regulatory approvals and other customary closing conditions.
Vista Outdoor and CSG say they have received all regulatory approvals required under the merger agreement for the CSG Transaction and are prepared to close the CSG deal before the end of 2024. They have mutually agreed to extend the termination date of the CSG merger agreement to December 11, 2024.
At the closing of the CSG deal, CSG will pay $2.225 billion to Vista in which stockholders will receive $25.75 in cash per Vista Outdoor share and one share of Revelyst common stock for each share of Vista Outdoor common stock. At the closing of the SVP deal, SVP will pay Revelyst stockholders an aggregate of $1.125 billion, representing an estimated $19.25 in cash per share of Revelyst common stock.
As part of the SVP and the CSG deals, Vista Outdoor, CSG and SVP have agreed to certain amendments to the separation agreement currently in place to separate the Kinetic Group and Revelyst. In addition, CSG will no longer invest in Revelyst at the closing of the CSG transaction.
J.P. Morgan is acting as sole financial adviser to CSG, and Clifford Chance LLP is acting as legal adviser.
Vista Outdoor co-CEOs Eric Nyman and Jason Vanderbrink expressed their excitement 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,” the memo states. “We are confident these transactions maximize stockholder value while also pursuing the best path forward for our company, stakeholders and valued employees.”
Upon completing Vista’s review, Nyman and Vanderbrink will receive $1.2 million in bonuses. Four other executives at Vista Outdoor were granted $500,000 retention bonuses, according to reports.
