R
Rembrandt
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No rumor, looks like Cabela's is up for sale, anyone have any spare cash?....only 800-900 million
Go to... www.thedeal.com then search for Cabela's
Retailer Cabela's goes on the block
by Josh Kosman
Updated 06:19 PM EST, Jul-3-2002
It's hunting season. The family that owns Cabela's Inc., the world's largest outdoor retailer specializing in hunting, fishing and camping equipment, is selling the company in a limited auction, said several sources following the process.
Privately held Cabela's, based in Sidney, Neb., may not be widely known on Wall Street, but it distributes about 70 million catalogs a year, generating about $100 million in Ebitda [that's "Earnings Before Interest, Taxes, Depreciation and Amortization"] and $1 billion in sales. Cabela's is hoping to attract a buyer willing to pay $800 million to $900 million, a source said.
Cabela's hired J.P. Morgan Chase & Co. to run the auction and was scheduled to send sales books to suitors in late June, including financial buyers. The Orvis Co. Inc. is one strategic buyer that's likely to participate. If all goes according to plan, the company will select a buyer by the end of August.
J.P. Morgan Partners owns an equity stake in Cabela's. A spokeswoman for Cabela's did not return calls. A J.P. Morgan spokeswoman declined comment.
Cabela's fishing for a buyer is one sign of high interest in well-positioned retail chains. The Cabela family is doing well with the company and has no pressing need to exit. "It's not shocking they're for sale," said an interested observer. "If they were ever going to do a deal, this would be a good time."
The family may well have been intrigued by a number of rich deals in the catalog business. On June 27, New York private equity firm Cortec Group Inc. agreed to pay $210 million, or about eight times Ebitda, for DRL Holdings Inc., the parent of Dr. Leonard's and Carol Wright Gifts catalogs, in an auction that exceeded seller expectations. And Sears, Roebuck and Co. in May agreed to pay $1.86 billion in cash for upscale catalogue and Internet retailer Lands' End Inc., more than a 12 times Ebitda multiple.
Buyers are showing interest because they believe they can make more money per catalog customer than ever before, according to Jerry West, a New York-based catalog industry mergers and acquisitions consultant. "We just went through two deals that were attractive because the retailers had a good position on the Web and in retail," West said.
Cabela's has a core catalog business, seven mammoth retail shops (which are part amusement centers) and an Internet presence. "The buyer pool is very impressed with multichannel distribution that is synergistic channel to channel. People thought at first catalogs would be blown away by Internet marketing," West said. "But what they found is that the catalog is a vehicle to get the customer to order on the Internet."
In particular, financial buyers, most of which have avoided the sector, have recently become enamored of catalog retailers. "Some classic LBO shops have come into our industry because they like the multichannel stuff. We are not a capital intensive industry, and we are not subject to technological revolution," West said.
Go to... www.thedeal.com then search for Cabela's
Retailer Cabela's goes on the block
by Josh Kosman
Updated 06:19 PM EST, Jul-3-2002
It's hunting season. The family that owns Cabela's Inc., the world's largest outdoor retailer specializing in hunting, fishing and camping equipment, is selling the company in a limited auction, said several sources following the process.
Privately held Cabela's, based in Sidney, Neb., may not be widely known on Wall Street, but it distributes about 70 million catalogs a year, generating about $100 million in Ebitda [that's "Earnings Before Interest, Taxes, Depreciation and Amortization"] and $1 billion in sales. Cabela's is hoping to attract a buyer willing to pay $800 million to $900 million, a source said.
Cabela's hired J.P. Morgan Chase & Co. to run the auction and was scheduled to send sales books to suitors in late June, including financial buyers. The Orvis Co. Inc. is one strategic buyer that's likely to participate. If all goes according to plan, the company will select a buyer by the end of August.
J.P. Morgan Partners owns an equity stake in Cabela's. A spokeswoman for Cabela's did not return calls. A J.P. Morgan spokeswoman declined comment.
Cabela's fishing for a buyer is one sign of high interest in well-positioned retail chains. The Cabela family is doing well with the company and has no pressing need to exit. "It's not shocking they're for sale," said an interested observer. "If they were ever going to do a deal, this would be a good time."
The family may well have been intrigued by a number of rich deals in the catalog business. On June 27, New York private equity firm Cortec Group Inc. agreed to pay $210 million, or about eight times Ebitda, for DRL Holdings Inc., the parent of Dr. Leonard's and Carol Wright Gifts catalogs, in an auction that exceeded seller expectations. And Sears, Roebuck and Co. in May agreed to pay $1.86 billion in cash for upscale catalogue and Internet retailer Lands' End Inc., more than a 12 times Ebitda multiple.
Buyers are showing interest because they believe they can make more money per catalog customer than ever before, according to Jerry West, a New York-based catalog industry mergers and acquisitions consultant. "We just went through two deals that were attractive because the retailers had a good position on the Web and in retail," West said.
Cabela's has a core catalog business, seven mammoth retail shops (which are part amusement centers) and an Internet presence. "The buyer pool is very impressed with multichannel distribution that is synergistic channel to channel. People thought at first catalogs would be blown away by Internet marketing," West said. "But what they found is that the catalog is a vehicle to get the customer to order on the Internet."
In particular, financial buyers, most of which have avoided the sector, have recently become enamored of catalog retailers. "Some classic LBO shops have come into our industry because they like the multichannel stuff. We are not a capital intensive industry, and we are not subject to technological revolution," West said.
