Bass Pro Shops, Cabela tweak deal to appease regulators

Under the original deal, Bass Pro Shops planned to take over the retail arm of Cabela's, while Capital One had planned to take over World's Foremost Bank.

Bass Pro will acquire Cabela's for $61.50 per share, lower than the originally agreed upon $65.50-per-share price, Cabela's said.

Bass Pro Shops is lowering the price it will pay to buy rival outdoor sports retailer Cabela's Inc. - both of which have Colorado stores - as part of an amended merger agreement. Synovus will acquire some assets and liabilities of World's Foremost Bank, including deposits of about $1.2 billion. Capital One, the proposed buyer of Cabela's banking and credit card businesses, had to back out of the deal due to an unrelated regulatory situation that would have delayed the merger significantly.

Cabela's announced Monday it has agreed to a $5 billion purchase price, about $500 million less than originally announced in the October 3, 2016, merger agreement, according to a written statement.

The Journal Star reported the renegotiation of the deal was necessary after Capital One ran into issues getting regulatory approval to buy World's Foremost Bank.

Cabela's did not explain why it agreed to accept a lower price from Bass Pro Shops.

Cabela's operates more than 80 stores in the USA and Canada, including one location in Mitchell and one in Rapid City.

"We're excited to announce this agreement, which allows us to look ahead with greater certainty toward the completion of our merger with Bass Pro Shops and offers a positive step forward for all parties", Tommy Millner, Cabela's CEO, said in the statement.

That also held up the sale of the retail operation to Bass Pro.

What's changed since last fall that makes Cabela's worth less now? However, according to Cabela's statement, it still needs approval from the company's shareholders, and it will need a few more regulatory approvals as well.

The Bass Pro Shops merger remains subject to approval by Cabela's shareholders, as well as antitrust clearance and other customary closing conditions.

Cabela's shares were up $3.80 from Monday's close and were at $57.49 though mid-morning trading Tuesday.

The companies have an overlap across Texas, Missouri and Kansas.

In January, Cabela's said in a regulatory filing that it received a second request for information from the Federal Trade Commission.

A Bass Pro Shops/Cabela's merger would create a national chain with more than 180 locations, roughly 40,000 workers with control of more than 20 percent of the $50 billion USA hunting, camping and fishing market, analysts at Stifel Nicolaus have estimated.

Vanessa Coleman

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