Anoka’s Vista Outside spending as much as $590M for mountain bike gear maker

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Anoka-based Vista Outdoor has agreed to acquire Fox Racing, a maker of motocross and mountain bike gear, in a deal that could reach $590 million.

Vista, which announced earlier this year that it would split its sporting goods and ammunition brands into two separate companies in 2023, isn’t pausing its aggressive merger and acquisition strategy to wait for that process to complete.

“With the acquisition of Fox Racing, we continue the successful execution of our strategy of using value-added acquisitions to expand our leadership position and capture long-term growth opportunities in the outdoor recreation space,” said Chris Metz, Vista’s chief executive, in a press release.

This is Vista Outdoor’s eighth acquisition in just over two years. It’s also the largest of those deals, which include the nearly $475 million deal for Foresight Sports in September.

The initial purchase price for Fox Racing is $540 million, but could increase by $50 million depending on the achievement of certain profit targets.

Based in Irvine, California, privately held Fox Racing Inc. manufactures protective gear and apparel for adventure riders and racers. It generates annual sales of approximately $350 million and adjusted earnings of $55 million.

Products should pair well with Vista Outdoor’s existing brands including Bell Helmets, Giro, Blackburn, Krash, Copilot and Raskullz.

Fox Racing CEO Jeffrey McGuane and the company’s other executives will continue to lead the brand post-acquisition.

“Together we can leverage the heritage of our leading brands, leverage new supply chain synergies, expand our deep and established channels, and appeal to an expanded customer base,” McGuane said in the press release.

Vista will fund the deal with new debt. The deal is expected to close by the end of September, and Fox Racing is expected to contribute to Vista’s revenue immediately.

Vista Outdoor shares closed at $26.94 on Wednesday, down nearly 9%.