Bass Pro To Acquire Outdoor-Gear Rival Cabela’s

Bass Pro Shops is close to acquiring Cabela’s Inc. (NYSE:CAB) after partnering with Goldman Sachs Group Inc’s private equity arm and Capital One Financial Corp. to submit the winning bid for the company. The wilderness-themed retailer is buying Cabela’s for $65.50 per share, or about $5.5 billion. Bass Pro reportedly beat out private-equity firm Sycamore Partners on the deal. Sycamore Partners had teamed up with U.S. credit card company Synchrony Financial to make an offer.

The deal would unite two of America’s largest outdoor-sports equipment retailers. Bass Pro Shops Founder and CEO Johnny Morris will continue as CEO and majority shareholder of the new entity, which will remain a private company. The retailers are expected to close the deal in the first half of 2017. However, it is still possible that the outcome will change.

The deal likely would include the retailer’s lucrative credit-card operation, which issues the Cabela’s Club card. Bass Pro Shops is also launching a new credit-card partnership with a banking subsidiary of Capital One. All Cabela’s CLUB points and Bass Pro Shops Outdoor Rewards points will be unaffected by the transactions, according to a company statement.

Bass Pro could move to consolidate the operations of the merged companies. Its current Springfield, Missouri, home office would most likely serve as the combined company’s headquarters. It is unknown what that would mean for the 2,000 workers at Cabela’s headquarters in Sidney, Nebraska.

Cabela’s was founded by brothers Richard and Jim Cabela in 1961. Cabela’s is a highly respected marketer of hunting, fishing, camping, shooting sports and related outdoor merchandise. Cabela’s has 85 specialty retail stores, primarily in the western U.S. and Canada. Jim, now in his mid-70s, still serves as chairman. Richard died last year.

Revenue and profit growth had sputtered at Cabela’s in recent quarters. In October of last year, the company said that “significant weakness” in its fall apparel and footwear contributed to a disappointing third quarter. Cabela’s has been under pressure to pursue a sale and began a strategic review of its businesses in December. Shares of the company dropped 30 percent in the two years through 2015, but have surged 18 percent this year.

Activist investor Elliott Associates had pressed for a sale. The New York hedge fund recently disclosed an 11 percent stake in the company. Cabela’s has steadfastly maintained its silence in the wake of the activist stake.

Bass Pro was founded by Johnny Morris ten years after Cabela’s, in 1971. Bass Pro Shops is a leading national retailer of outdoor gear and apparel, with 99 stores and Tracker Marine Centers located primarily in the eastern part of the U.S. and Canada. The company, which employs approximately 20,000 team members, has been named by Forbes as one of “America’s Best Employers.”