DALLAS--(BUSINESS WIRE)--MNC Capital Partners, L.P. today announced that it has submitted an increased all-cash proposal to acquire all of the outstanding shares of Vista Outdoor, Inc. (NYSE: VSTO) for $39.50 per share, or over $3.0 billion.
The revised proposal represents a premium of 46% to the VWAP from when Vista’s transaction with the Czechoslovak Group a.s. (“CSG”) was announced on October 16, 2023 to the last closing price before MNC’s initial offer on February 19, 2024. The revised offer is also an over 30% premium to the last closing price prior to MNC’s initial offer.
Additionally, the latest offer implies a value for Revelyst of over $1 billion, as compared to Vista’s valuation for Revelyst of $570 million disclosed in its own investor presentation on February 1, 2024.
On May 17, 2024, MNC wrote to the Vista Board that it was on a path to increase its offer, but it required additional information to be in a position to do so. Much of that information was not provided, including the fees and expenses of Vista’s bankers, lawyers and other transaction advisors as well as the amount of additional payments Vista planned on making to employees above what was disclosed for the sale of Kinetic ("Transaction Expenses"). MNC’s revised offer is based on the Transaction Expenses being $50 million, and will be adjusted up or down based on the actual amount of Transaction Expenses.
While Vista has asserted that a price increase by MNC was warranted because of cash generation and debt pay-down, that value was already reflected in MNC’s initial proposal. MNC notes that much of the cash generation related to inventory reduction and that working capital changes do not change the value of the Company.
MNC believes that absent its interest in an acquisition, Vista’s share price would trade back to where it was prior to MNC’s initial offer, which was below $30.00 per share. This is evidenced by Vista’s share price decline of 3% or $1.00 per share following Vista Board’s rejection on May 28, 2024 of MNC’s prior proposal. From May 17 until May 28, Vista not only failed to provide needed due diligence, it also did not respond to the merger agreement that MNC had sent the Company.
MNC’s revised proposal is not subject to any financing condition and the financing structure remains the same. Alongside the revised proposal, MNC has provided Vista with debt commitment papers with terms that are ready to be executed, upon receipt of requested lender due diligence information.
“MNC is proud to represent an American alternative. Our proposal provides compelling value and certainty for Vista shareholders and is in the best interests of Vista’s employees and the broader safety and security of the U.S. We have confidence in the management of both the Kinetic Group and Revelyst and expect to work closely with them to achieve the full potential of both companies,” said Mark Gottfredson, Managing Director of MNC Capital.