Fox Racing Complements Vista Outdoor's
Existing Brand Portfolio, Expands Leadership Positions in Helmets,
Protective Gear and Apparel for Motocross and Mountain
Biking
Acquisition Strengthens Outdoor Products
Segment, Adds Approximately $350
Million in Revenue
ANOKA,
Minn., Aug. 8, 2022 /PRNewswire/ -- Vista Outdoor
Inc. (NYSE: VSTO), the parent company of 40 renowned brands that
design, manufacture and market sporting and outdoor products to
consumers around the globe, today announced the closing of its
acquisition of Irvine,
Calif.-based Fox Racing for the purchase price of
$540 million, with the potential for
an additional $50 million earnout
based on Fox Racing's financial performance. The addition of Fox
Racing, a global icon in performance motocross, mountain bike and
lifestyle gear for adventure seekers, allows Vista Outdoor to add
yet another category-leading brand to its portfolio while
maintaining a strong balance sheet and reinvesting in its existing
business to drive organic growth.
"We are excited to welcome Fox Racing to the Vista Outdoor
family," said Chris Metz, Chief
Executive Officer, Vista Outdoor. "This legendary brand brings us
into one of the most passionate sporting bases with motocross and
expands our footprint in mountain biking. Fox Racing is synergistic
to our existing action sports business unit, which includes Bell
Helmets, Giro, Blackburn, Krash, Copilot and Raskullz. The addition
of Fox Racing to our portfolio will allow us to target multiple
consumer demographics across mountain and road biking,
skiing/snowboarding and powersports. With the Fox Racing
acquisition now closed, and the planned acquisition of Simms
Fishing Products announced, we're continuing the successful
implementation of our strategy to use accretive acquisitions to
expand leadership positions across categories, while enhancing our
ability to capitalize on long-term growth opportunities in outdoor
recreation."
For 50 years, Fox Racing has been a leading voice in the
motocross and adventure community, with a dedicated consumer
following and talented group of employees that embody the brand's
mission to "honor yesterday, conquer today, and invent tomorrow."
Fox Racing's deep history of producing innovative gear that enables
racers and explorers to reach new heights aligns perfectly with
Vista Outdoor's existing portfolio of leading outdoor brands. Fox
Racing grew net sales by a compound annual growth rate of
approximately 20 percent from calendar year 2019 to 2021 and is
expected to grow another roughly 20 percent in calendar year
2022.
Jeffrey McGuane, CEO of Fox
Racing, continues to lead the brand along with current members of
Fox Racing's leadership team. Fox Racing is now part of Vista
Outdoor's Outdoor Products segment and will be included in the new
Outdoor Products Company upon completion of the previously
announced separation.
Details on the Transaction
Vista Outdoor paid a gross
purchase price of $540 million, subject to certain customary
closing adjustments and not including contingent incentives of up
to $50 million, upon the achievement of certain EBITDA
targets. For calendar year 2022, Fox Racing's full-year net sales
and adjusted EBITDA are expected to be approximately $350
million and $55 million, respectively. Vista Outdoor
expects the transaction to be immediately accretive to earnings,
excluding transaction costs, transition costs and inventory
step-up.
Vista Outdoor financed this acquisition through a combination of
a $600 million asset-based revolving credit facility,
which will replace Vista Outdoor's existing asset-based revolving
credit facility, and a $350 million secured term loan
facility. Vista Outdoor's leverage ratio remains well within the
target leverage ratio of one to two times.
About Fox Racing
Since 1974, when Geoff
Fox first introduced the world to our iconic logo, Fox Racing
has been all about family. Not just in name—a legacy that continues
to this day—but the idea of celebrating and sharing the passion of
life on two wheels with the world. This is what drives us, inspires
us, and keeps us close. Because "skulk" is more than just a word
for a family of foxes—it's the adventure, the fidelity of friends,
and everything that happens along the way.
About Vista Outdoor Inc.
Vista Outdoor (NYSE: VSTO) is
the parent company of more than three dozen renowned brands that
design, manufacture and market sporting and outdoor products. We
serve a broad and diverse range of consumers around the globe,
including outdoor enthusiasts, golfers, cyclists, backyard
grillers, campers, hunters, recreational shooters, athletes, as
well as law enforcement and military professionals. Our reporting
segments, Outdoor Products and Sporting Products, provide these
consumers with a wide range of performance-driven, high-quality and
innovative outdoor and sporting products. Our operating model
leverages shared resources across brands to achieve levels of
excellence and performance that would be out of reach for any one
brand on its own. Brands include Remington Ammunition, Bushnell,
CamelBak, Bushnell Golf, Foresight Sports, Fox Racing, Bell
Helmets, Camp Chef, Giro, QuietKat, Stone Glacier, Federal
Ammunition and more. Vista Outdoor products are sold at leading
retailers and distributors across North America and
worldwide. For news and information, visit our website
at www.vistaoutdoor.com.
Forward-Looking Statements
Some of the statements made
and information contained in this report, excluding historical
information, are "forward-looking statements," including those that
discuss, among other things: our plans, objectives, expectations,
intentions, strategies, goals, outlook or other non-historical
matters; projections with respect to future revenues, income,
earnings per share or other financial measures for Vista Outdoor;
and the assumptions that underlie these matters. The words
"believe," "expect," "anticipate," "intend," "aim," "should" and
similar expressions are intended to identify such forward-looking
statements. To the extent that any such information is
forward-looking, it is intended to fit within the safe harbor for
forward-looking information provided by the Private Securities
Litigation Reform Act of 1995. Numerous risks, uncertainties and
other factors could cause our actual results to differ materially
from the expectations described in such forward-looking statements,
including the following: supplier capacity constraints, production
or shipping disruptions or quality or price issues affecting our
operating costs; the supply, availability and costs of raw
materials and components; increases in commodity, energy, and
production costs; seasonality and weather conditions; our ability
to complete acquisitions, realize expected benefits from
acquisitions and integrate acquired businesses; reductions in or
unexpected changes in or our inability to accurately forecast
demand for ammunition, accessories, or other outdoor sports and
recreation products; disruption in the service or significant
increase in the cost of our primary delivery and shipping services
for our products and components or a significant disruption at
shipping ports; risks associated with diversification into new
international and commercial markets, including regulatory
compliance; our ability to take advantage of growth opportunities
in international and commercial markets; our ability to obtain and
maintain licenses to third-party technology; our ability to attract
and retain key personnel; disruptions caused by catastrophic
events; risks associated with our sales to significant retail
customers, including unexpected cancellations, delays, and other
changes to purchase orders; our competitive environment; our
ability to adapt our products to changes in technology, the
marketplace and customer preferences, including our ability to
respond to shifting preferences of the end consumer from brick and
mortar retail to online retail; our ability to maintain and enhance
brand recognition and reputation; others' use of social media to
disseminate negative commentary about us, our products, and
boycotts; the outcome of contingencies, including with respect to
litigation and other proceedings relating to intellectual property,
product liability, warranty liability, personal injury, and
environmental remediation; our ability to comply with extensive
federal, state and international laws, rules and regulations;
changes in laws, rules and regulations relating to our business,
such as federal and state ammunition regulations; risks associated
with cybersecurity and other industrial and physical security
threats; interest rate risk; changes in the current tariff
structures; changes in tax rules or pronouncements; capital market
volatility and the availability of financing; foreign currency
exchange rates and fluctuations in those rates; general economic
and business conditions in the United States and our
markets outside the United
States, including the war in Ukraine and the
imposition of sanctions on Russia, conditions affecting
employment levels, consumer confidence and spending, conditions in
the retail environment, and other economic conditions affecting
demand for our products and the financial health of our customers;
and risks related to our Planned Separation. You are cautioned not
to place undue reliance on any forward-looking statements we make.
A more detailed description of risk factors that may affect our
operating results can be found in Part 1, Item 1A, Risk Factors, of
our Annual Report on Form 10-K for fiscal year 2022 and in the
filings we make with Securities and Exchange Commission (the "SEC")
from time to time. We undertake no obligation to update any
forward-looking statements, except as otherwise required by
law.
For Immediate
Release
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Media
Contact:
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Investor
Contact:
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Eric
Smith
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Shelly
Hubbard
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Phone:
901-573-9156
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Phone:
612-518-5406
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E-mail:
media.relations@vistaoutdoor.com
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E-mail: investor.relations@vistaoutdoor.com
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SOURCE Vista Outdoor Inc.