MNC Capital has raised its bid for Vista Outdoor to $3.2 billion, the investment firm said on Wednesday, just days after the U.S. company agreed to sell its sporting goods and ammunition business to Prague-based Czechoslovak Group (CSG).
The latest development in the months-long bidding war for the parent of Federal Ammunition and Remington Ammunition comes against the backdrop of rising demand for military supplies since the start of the Russia-Ukraine conflict.
MNC Capital, whose previous bids have been rejected by Vista in favor of its plan to separate its businesses, increased its offer to $42 per share from $39.50.
“We believe shareholder pressure to accept the whole takeout offer could meaningfully increase now that the price has surpassed the $40 mark,” said B. Riley Securities analyst Anna Glaessgen.
Vista’s shares rose as much as 11.4% to $37.64.
On Monday, Vista agreed to sell its sporting products and ammunition business, called the Kinetic Group, to CSG for about $2 billion, after the company raised its offer for a second time.
CSG and Vista did not immediately respond to Reuters requests for comment on MNC’s revised bid.
The CSG deal received clearance from the Committee on Foreign Investment in the United States (CFIUS), which reviews transactions involving foreign investment in the country to determine their effect on national security, on Tuesday.
Meanwhile, proxy advisory firm Institutional Shareholder Services (ISS) said on Wednesday Vista’s shareholders should “abstain” from voting for the merger with CSG at a meeting scheduled for July 2, in a recommendation seen by Reuters.
MNC Capital said on Wednesday its revised proposal had no regulatory issues and was not subject to financing conditions, adding it did not see any basis to further raise the bid.
Vista has previously rejected MNC Capital’s bids, citing they undervalued the company and its performance gear business Revelyst.
The Anoka, Minnesota-based company has maintained that Revelyst would give more value to shareholders as a standalone company.
Source: Reuters.com