Colt CZ Unleashes: In a fascinating turn of events in the U.S. sporting and outdoor goods industry, Czech gunmaker Colt CZ Group (CZG.PR) has extended a takeover offer to Vista Outdoor (VSTO.N), a move that could reshape the landscape of this dynamic market. The proposed valuation stands at around $1.7 billion and Vista Outdoor is currently deliberating the $30 per share bid. This offer, while at a premium to Vista’s recent closing price of approximately $25.75, falls below the 2023 high of $33.78 reached in September.
Vista Outdoor, in response to the proposal, issued a statement indicating that it had not reached any determination regarding the offer. The complexities deepen as Colt CZ suggests keeping the company intact, challenging Vista’s previously announced plan to sell its sporting products business to Czechoslovak Group (CSG) in a deal worth $1.91 billion, unveiled in October.
Colt CZ, in a letter to Vista’s board, emphasized its commitment to retaining Vista as a cohesive entity, diverging from the planned CSG transaction. The letter contends that the market’s reaction to the CSG deal on October 16, 2023, resulted in a swift decline in Vista’s share price, prompting Colt CZ’s alternative proposition. The intriguing aspect of this proposal is the inclusion of a $900 million share buyback program that Colt CZ plans to implement post-transaction closure. This would be funded by $600 million of new equity issued at the transaction price and $300 million of debt.
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Vista Outdoor, acknowledging Colt CZ’s proposal, has committed to reviewing the offer. However, it maintains that there is no alteration in its recommendation for the CSG deal. The intricacies of this unfolding narrative have left the industry and investors on the edge, anticipating the next chapter in this business saga.
It’s worth noting that Colt CZ, alongside a majority shareholder and its chairman, disclosed in October that they collectively acquired more than 5% of Vista shares. The Czech group had previously acquired the U.S. gun brand Colt in 2021, adding another layer to its strategic moves in the sector.
As the boards of both companies navigate this complex landscape, the industry watches closely, poised for potential shifts and transformations. The interplay of market dynamics, shareholder considerations, and strategic decisions creates an intricate tapestry, and the story continues to evolve in this dynamic sector.
Our Reader’s Queries
Is Colt firearms still in business?
After losing its M4 contract in 2013, Colt faced financial difficulties and filed for Chapter 11 bankruptcy in 2015. However, the company emerged from bankruptcy in January 2016. Recently, ?eská zbrojovka Group acquired Colt in 2021 and announced a name change to Colt CZ Group in April 2022.
Did CZ buy out Colt?
In a recent move, the European company has acquired the Colt Holding Company for a whopping $220 million. This acquisition will pave the way for the company to expand its reach in the U.S. market. The Colt’s Manufacturing Company, which is a subsidiary of the Colt Holding Company, will now be under the European company’s umbrella. This strategic move is expected to bring in new opportunities and growth prospects for the company.
Who is the CEO of Colt CZ?
Dennis Veilleux, the CEO of Colt Holding Company LLC, has been appointed to the Colt CZ Group Board of Directors as the head of business since July 2021.
Can I order a gun directly from Colt?
At Colt’s Manufacturing Company, we don’t sell firearms directly to consumers. If you’re interested in purchasing a custom Colt gun, please reach out to our Customer Service team. We’ll work with you to design your dream firearm and then help you find a dealer who can place your order.