Vista Outdoor (NYSE:VSTO) Inc., a leading outdoor sports and recreation products company, has turned down a merger proposal from Colt CZ Group SE. Interim CEO Gary McArthur announced the decision on Wednesday, stating that the company's Board of Directors, after thorough consultation with financial and legal advisors, found the offer financially inferior and lacking in essential details compared to an existing agreement with Czechoslovak Group a.s. (CSG).
The company is moving forward with the planned acquisition of its Sporting Products division by CSG, a transaction that is anticipated to be finalized in 2024, pending stockholder approval and regulatory clearance. Vista Outdoor's Board and independent directors are in favor of the CSG deal.
Vista Outdoor operates two main segments: Outdoor Products and Sporting Products. The latter includes well-known brands such as Federal Ammunition and CamelBak. The transaction with CSG is set to involve subsidiary Revelyst Inc., CSG Elevate II Inc., CSG Elevate III Inc., and includes Guarantor Provisions by Czechoslovak Group a.s.
The company has cautioned that the acquisition process may face several challenges, including the need for timely stockholder endorsement, regulatory consent, potential rival bids, and managerial distractions that could impact business operations during the transition.
The advisory firms involved in guiding Vista Outdoor through this process are Morgan Stanley & Co (NYSE:MS)., Cravath, Swaine & Moore LLP for the company overall, and Moelis (NYSE:MC) & Company LLC along with Gibson, Dunn & Crutcher LLP for the independent directors.
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