Take a second and let that sink in. The purchase would be the outdoor equivalent of General Motors buying Ford, Walmart buying Target, or McDonald’s buying Burger King. Tectonic plates of retail are shifting, and the outdoor industry may never be the same.
Details are still sketchy, but Bass Pro Shops is rumored to be interested in buying Cabela’s; so interested that both companies are refusing to comment, but those in the know are telling the media that BPS has already contacted an investment bank to prepare an offer.
Reuters announced the possibility Thursday. Bass Pro is reportedly preparing its offer, and Cabela’s is reportedly “explor[ing] its options,” having also reached out to private equity firms to solicit interest, according to the news agency.
When the two companies were contacted by Reuters for comment, Bass Pro declined and Cabela’s simply ignored the request. The old adage “silence speaks volumes” comes to mind.
Both companies grew by leaps and bounds following the great gun sale boom of 2013, when firearm and ammo purchases skyrocketed amid calls for new gun control legislation. Both have seen major profit increases and expanded their number of retail stores as a result. Following Thursday’s news, Cabela’s stock jumped another 13 percent, bringing it to a total market capitalization of $3 billion.
Cabela’s was put on this path by Elliott Management, an activist investor who holds an 11 percent stake in the company. In October, Elliott Management disclosed its stake percentage in the company and called for it to “explore strategic alternatives.” Cabela’s has since reached out to private equity firms to solicit interest, according to Reuters.
The two companies are legendary to sportsmen. Bass Pro Shops was started by fishing great Johnny Morris (#145 on the Forbes 400 list) in 1971, selling fishing gear from his father’s liquor store. The company grew through mailed catalogs and Morris’s Tracker boats, becoming a pillar of the outdoor industry.
Forbes estimates Morris’s net worth at $4.1 billion, with Bass Pro reeling in an estimated $4.2 billion annually.
Cabela’s was created by brothers Dick and Jim Cabela in 1961. From $45 worth of fishing flies, the company grew to become synonymous with museum-quality wildlife exhibits. Like BPS, mailed product catalogs were a staple of the business. The company went public in 2004, and today nets an estimated $3 billion annually.
Read Sporting Classics‘ profiles on these outdoor greats in the “Legends & Legacies“ story by David Cabela, and stay tuned to future Daily articles for more details on the potential purchase.
Cover Image: Bass Pro Shops