Vista Outdoor has entered into a definitive agreement with funds managed by Strategic Value Partners (SVP), an 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 (CSG) to acquire The Kinetic Group, increasing the purchase price for the Kinetic Group to $2.225 billion._x000D_
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The SVP transaction is subject to the completion of the CSG transaction. 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._x000D_
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“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 helps us achieve that objective,” Michael Callahan, chairman of the Vista Outdoor board of directors, said. “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.”_x000D_
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“We are strong believers in the Revelyst story and the potential of this business,” David Geenberg, head of SVP’s North American corporate investment team, said. “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 be partnering with the strong leadership team at Revelyst to help unlock its full potential with SVP’s resources.”_x000D_
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“We look forward to creating long-term value at The Kinetic Group as part of the CSG portfolio,” Michal Strnad, CEO and owner of CSG, said. “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.”_x000D_
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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 have received all regulatory approvals required under the merger agreement for the CSG transaction and are prepared to close the CSG transaction prior to the end of 2024, subject to receipt of stockholder approval and satisfaction of other customary closing conditions. CSG and Vista Outdoor have mutually agreed to extend the termination date of the CSG merger agreement to Dec. 11, 2024._x000D_
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At the closing of the CSG transaction, CSG will pay the company $2.225 billion, subject to certain purchase price adjustments, and Vista Outdoor 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 transaction, SVP will pay Revelyst stockholders an aggregate of $1.125 billion, subject to a net cash adjustment, representing an estimated $19.25 in cash per share of Revelyst common stock, based on current management estimates of expected net cash of Revelyst as of the closing of the SVP transaction._x000D_
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As part of the SVP transaction and the CSG transaction, 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 be investing in Revelyst at the closing of the CSG transaction._x000D_
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In connection with the announcement of the SVP transaction and the CSG transaction, the company will adjourn the special meeting of stockholders currently scheduled for Oct. 9, 2024._x000D_
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Morgan Stanley is acting as sole financial adviser to Vista Outdoor and Cravath, Swaine & Moore is acting as legal adviser to Vista Outdoor. Moelis & Company is acting as sole financial adviser to the independent directors of Vista Outdoor and Gibson, Dunn & Crutcher is acting as legal adviser to the independent directors of Vista Outdoor._x000D_
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J.P. Morgan is acting as sole financial adviser to CSG with Clifford Chance acting as legal adviser.
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