Bass Pro lowers price for Cabela's under new merger terms

The outdoor sign seen at the Cabela's store in Denver

The outdoor retail rivals also amended their merger agreement, lowering the price tag to smooth approval: Bass Pro Shops will now acquire Cabela's for $61.50 per share in cash (down from the previously announced price of $65.50), an aggregate transaction value of $5 billion. The company declined to say why the price was cut.

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. Synovus will keep its $1.2 billion in deposits before reselling it to the original purchaser Capital One.

Cabela's announced Monday it has agreed to a $5 billion purchase price, about $500 million less than originally announced in the October 3, 2016, merger agreement, according to a written statement.

Cabela's will pay a $14 million termination fee to Capital One if the deal is terminated.

Bass Pro Shops will now buy Cabela's for about $5 billion, $500 million lower than the price agreed upon past year.

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 U.S. and Canada in a similar space, but with a primary focus on hunting.

"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", said Tommy Millner, Cabela's chief executive officer, in a statement.

The $61.50 per share price is still a good deal for shareholders, said Gordon, the University of MI professor, and even for the people of Sidney, the Nebraska town Cabela's now calls home.

What's changed since last fall that makes Cabela's worth less now?

That also held up the sale of the retail arm to Bass Pro.

The retailers, which overlap in Missouri, Kansas and Texas, each have a store in the St. Louis area.

The Federal Trade Commission, which regulates and enforces antitrust laws, had sought more information from the companies about the deal. Cabela's Board of Directors unanimously approved the transaction, which is expected to close in the third quarter of 2017, subject to Cabela's shareholder approval, regulatory approvals and other customary closing conditions.

A Bass Pro Shops/Cabela's merger would create a national chain with more than 180 locations, roughly 40,000 workers with control of more than 20 percent of the $50 billion US hunting, camping and fishing market, analysts at Stifel Nicolaus have estimated.

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