In a related development, Cabela's has entered into agreements with Synovus Financial Corp. and Capital One Financial Corp.to sell its credit card business, known as World's Foremost Bank.
Under the amended agreement, Bass Pro Shops will acquire Cabela's for $61.50 per share in cash, representing an aggregate value of $5 billion.
Sidney, Neb. -based Cabela's also said it would sell its bank unit in a two-step deal as it seeks regulatory clearance for the transactions.
"It seems to us that SNV is merely serving as a regulatory "pass-through" in this transaction for Cabela's and Capital One, and, in turn, will gain increased liquidity", wrote Hovde Group Inc. analyst Kevin Fitzsimmons in a note Monday adding that Synovus will receive about $75 million in payment from Capital One and Cabela's for its roll in the transaction.
The renegotiation of the deal was necessary after Capital One ran into issues getting regulatory approval to buy World's Foremost Bank.
The initial deal, announced October 3, called for Bass Pro Shops parent BPS Direct LLC to pay $5.5 billion in cash, or $65.50 per share.
Privately owned Bass Pro Shops owns over 90 giant retail locations in North America that focus on fishing, boating, and camping, while Cabela's runs roughly 85 stores in the USA and Canada in a similar space, but with a primary focus on hunting. 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.
That also held up the sale of the retail arm to Bass Pro.
"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 chief executive, said in a prepared statement. It also didn't help that Cabela's had poor sales results in the important fourth quarter of the year, the Omaha World-Herald reports.
Although closing the bank deal wasn't a condition of the merger of Bass Pro and Cabela's, it supported the changeover and delays led to fears that the overall merger would fall apart.
Cabela's employs roughly 2,000 of the 6,800 people who live there, but the headquarters would move to Springfield, Missouri - Bass Pro's home - once the deal closes. These sinister companies because many appear to be sound investments.