Bass Pro to buy rival Cabela’s in $5.5 billion deal

Cabela’s has agreed to be bought by Bass Pro Shops in a $5.5 billion deal, uniting two of America’s largest outdoors retailers with big followings among hunting and fishing enthusiasts.

The deal comes almost a year after activist investor Elliott Associates began pushing Cabela’s to consider a sale as its revenue and profit growth sputtered.

Executives said the merger would be complementary, with Cabela’s 85 stores located mostly in the western United States and Bass Pro Shops’ 99 stores mostly in the east.

But each has multiple locations in the Metroplex and Texas. Cabela’s has stores along Interstate 35W in north Fort Worth and in Allen, while Bass Pro has Outdoor World stores near Grapevine Mills and in Garland.

Cabela’s has other Texas stores in Buda, League City, Lubbock and Waco, while Bass Pro has stores in San Antonio, Round Rick, Pearland, Katy and Harlingen.

Nebraska-based Cabela’s, founded by brothers Richard and Jim Cabela in 1961, said in October of last year that “significant weakness” in its fall apparel and footwear contributed to a disappointing third quarter. Less than a week later, Elliott disclosed an 11 percent stake and said it would push for a shake-up. The company began a strategic review of its business in December.

Bass Pro was founded by Johnny Morris in 1972, working out of his father’s liquor store in Springfield, Mo. Morris is worth about $3.3 billion, according to the Bloomberg Billionaires Index.

In a statement, Morris said he hopes to continue growing the Cabela’s brand alongside his privately-held chain and said nothing about any possible store closures.

“The story of each of these companies could only have happened in America, made possible by our uniquely American free enterprise system,” Morris said. “We have enormous admiration for Cabela’s, its founders and outfitters, and its loyal base of customers.”

In winning the bidding for Cabela’s, Bass Pro beat out competition from private equity bidder Sycamore Partners, people familiar with the matter told Bloomberg.

As part of the deal, Capital One Financial is acquiring Cabela’s credit card business for an undisclosed amount.

Capital One didn’t disclose terms of the acquisition, which includes about $5.2 billion in credit-card receivables.

Capital One Chief Executive Officer Richard Fairbank has expanded the credit-card consulting firm he founded more than two decades ago into a diversified lender that ranks as the ninth-largest commercial bank by deposits in the U.S. A series of acquisitions, including retail card portfolios, energy investment banking and healthcare lending firms, have spurred the lender’s growth.

This story was originally published October 3, 2016 at 9:34 AM with the headline "Bass Pro to buy rival Cabela’s in $5.5 billion deal."