Pressure mounts on Vista Outdoor to consider acquisition offer

The challenges facing Vista Outdoor in its plan to sell its ammunition business and spin off the remaining outdoor division into a standalone, publicly traded company appear to be mounting.

TIG Advisors, an institutional investor that owns 532,000 shares of Vista Outdoor, announced Friday that it intends to vote against the pending sale of Vista’s ammunition business to Czechoslovak Group (CSG).

TIG said it supports an outright sale of all of Vista Outdoor to MNC Capital, which is offering to buy Vista for $42 per share. MNC wants to keep the company intact and take it private.

“The MNC offer presents both maximum certainty of value and reduced execution risk,” TIG said in a letter to Vista Outdoor’s board last week. “MNC has made its commitment clear, paying Vista shareholders $42 per share in cash. MNC has met Vista’s demands, including providing financing and a merger agreement, and yet the board is now moving to change the target by arguing that the transaction will take months to close. This is a disingenuous argument given that the board’s own “GEAR Up” transformation plan itself requires years to complete and exposes shareholders to significant execution risk. In addition, the company has relentlessly pressured the market to believe that the MNC offer significantly undervalues ​​Revelyst (the remaining outdoor business) based on an unproven turnaround scenario.”

The tug-of-war over the company’s future has included competing bids, multiple statements of retaliation between Vista’s board and MNC, and many other twists and turns.

Read the Daily’s article on the Vista Outdoor sale saga here.

Shareholder advisory firm recommends voting against sale

Another factor working against Vista Outdoor’s plan became public last week: Institutional Shareholder Services (ISS), an independent proxy advisory firm that advises large shareholders such as investment banks and asset management firms, recommended that shareholders vote against the sale of the munitions business to CSG. Once details of MNC’s offer to buy the entire company emerged, ISS’s position changed: first it supported the sale of the munitions business to CSG, then it advised shareholders to abstain, and now it recommended that they vote against the sale.

Vista’s board of directors was quite unhappy with ISS’s new position and said so in a statement Thursday.

“Vista Outdoor strongly believes that ISS reached an erroneous conclusion regarding the CSG Transaction and disagrees with the short-sighted and ill-informed recommendation made to Vista Outdoor shareholders,” the board said.

MNC Capital issued a further statement today, urging the Vista Board of Directors to engage with MNC to discuss the $42 per share offer.

“We continue to be confident that we can close the transaction within approximately 60 days of signing a merger agreement,” MC said in a statement. “Your advisors will confirm that a cash transaction without regulatory issues can be completed within that time frame. Yet Vista has publicly stated that a closing would ‘take several months.’ We therefore urge the board to conduct and disclose the necessary analyses so that shareholders can make an informed decision, reconsider its positions and engage with us to execute a merger agreement that we are confident your shareholders will approve. Both leading independent shareholder advisory firms have spoken about what they believe is best for shareholders. We are here and ready to engage constructively on the $42 deal that the market supports.”

Currently, all shareholders are due to vote on the sale of the munitions business to CSG on July 23.

Vista Outdoor is the parent company of more than three dozen brands that design, manufacture and market sports and outdoor products. Brands include Bushnell, CamelBak, Bushnell Golf, Foresight Sports, Fox Racing, Bell Helmets, Camp Chef, Giro, Simms Fishing, QuietKat, Stone Glacier, Federal Ammunition, Remington Ammunition and many others.