Vista Outdoor buys Fox Racing for $540 million
At over half a billion dollars, this is currently the deal of the year in the sports apparel and equipment sector. US group Vista Outdoors has announced the acquisition of Fox Racing, a US specialist in apparel and equipment for motocross and MTB, from Altamont Capital Partners, which had owned a majority stake in Fox Racing since 2014.
The parties are set to finalise the deal by the end of September, but financial terms have already been agreed. The operation is worth $540 million, with a potential $50 million additional bonus linked to Fox Racing's performance.
In May, Vista separated its hunting business from those connected with outdoor sporting activity, and Fox Racing’s acquisition gives a major boost to its presence in the cycling and motorcycling sectors, in which Vista already features with several helmet brands.
“Fox Racing is an ideal fit for our portfolio, with its reputation for high quality helmets, protective gear and apparel for motocross and mountain biking. Motocross and mountain biking are growing and familiar categories for Vista Outdoor,” said Chris Metz, CEO of Vista Outdoor. “Fox Racing is synergistic to our existing action sports business unit, which includes Bell Helmets, Giro, Blackburn, Krash, Copilot and Raskullz. The addition of Fox Racing to our portfolio will allow us to target multiple consumer demographics across mountain and road biking, skiing/snowboarding, and powersports,” added Metz.
Fox Racing was founded in California by Geoff Fox in 1974. It is a major player in the US cycling and motorcycling markets, forecasting a revenue of $350 million and a 16% EBITDA margin for fiscal 2022. According to Fox Racing’s CEO Jeffrey McGuane, who will continue to lead the company, sales grew at an average annual rate of 20% between 2019 and 2021, and are expected to grow at an even higher rate this year.
Fox Racing is present in 65 countries and generates 44% of its sales with motorcycle equipment and 38% with MTB equipment, notably helmets, protective gear and gloves. The brand’s lifestyle range accounts for 18% of its revenue, and features both casualwear and performance apparel. The lifestyle segment is one of the growth drivers Fox Racing’s new owner believes will enable the brand to expand further, in conjunction with new store openings and an acceleration of its international deployment.
Vista Outdoor has indicated that, in the USA alone, the motocross and MTB equipment market is worth over $3.4 billion, and has an 18% growth outlook according to certain studies. By acquiring Fox Racing, the 40th brand in its portfolio, the group intends to capture a sizeable share of this burgeoning market.
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