Wired News – Polaris Industries Acquires Privately-Owned Boat Holdings LLC

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LONDON, UK / ACCESSWIRE / June 1, 2018 / If you want access to our free research report on Polaris Industries Inc. (NYSE: PII) (“Polaris”), all you need to do is sign up now by clicking the following link www.active-investors.com/registration-sg/?symbol=PII as the Company’s latest news hit the wire. On May 30, 2018, the Company announced that it has signed an agreement to acquire Boat Holdings, LLC. Boat Holdings is a privately-owned Company and one of the leading Pontoon Boat manufacturer in the US. The all-cash transaction is valued at approximately $805 million. Register today and get access to over 1,000 Free Research Reports by joining our site below:

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The deal will allow Polaris to expand into one of the largest and fastest growing segments in the marine industry.

Management Comments

Commenting on the acquisition of Boat Holdings, Scott W. Wine, Chairman and Chief Executive Officer (CEO) of Polaris, said:

“This transaction epitomizes our disciplined growth strategy of entering attractive markets where we can establish and extend our leadership position. In addition to market share leadership, Boat Holdings expands Polaris’ footprint in the recreational outdoors market, commanding more of consumers’ discretionary spending.”

Steve Vogel, Chairman of Boat Holdings, added:

“With similar cultures, both businesses share the same passion for product and people, which has driven both our and their long-term success. As a trailblazer in its own right, Polaris is the perfect partner as we look to drive continued expansion and growth in this attractive segment.”

Transaction Details

Polaris is expected to pay approximately $805 million in cash to acquire Boat Holdings. The transaction price includes approximately $100 million net present value (NPV) in future net tax benefits which will be accrued to the merged Company. The deal has been approved by the Boards of Directors of both Polaris and Boat Holdings. The transaction is expected to close in Q3 2018, subject to regulatory approvals and related closing conditions.

Once the transaction is completed, Boat Holdings will operate as an independent business unit of Polaris. Bob Mack, President of Global Adjacent Markets and SVP of Corporate Development and Strategy, Polaris, will lead this business unit. Boat Holdings will continue to be headquartered in Elkhart, Indiana, and maintain its manufacturing facilities at this location post the completion of the deal.

About the Acquiree – Boat Holdings LLC

Founded in 1997, Elkhart, Indiana-based Boat Holdings is one of the largest manufacturer of pontoon boats in the US and is jointly-owned by the Vogel family, the Company’s management, and Balmoral Funds, which is a Los Angeles-based private equity firm. The Company manufactures and sells a wide range of pontoon, deck, and cruiser boats which are available across a range price points, as well as fully-custom built options. Some of the leading brands under which the Company sells its products include Bennington®, Godfrey Pontoon Boats®, Hurricane, and Rinker®. Boat Holdings has a strong dealer network in the US and Canada. The Company’s sales were approximately $560 million for FY17.

Advantages of the Deal

The acquisition will allow Polaris to enter the new market segment of recreational outdoors market in the marine industry. Since Boat Holdings is an established player offering premier brands of pontoon, deck, and cruiser boats with a strong dealer network, the deal will allow Polaris to gain a leadership position in this segment.

Polaris currently offers powersports vehicles for various uses across terrains – roads, trails, sand, dirt, and snow. The current acquisition will allow Polaris to round off its offerings across the outdoor powersports space, including water. The Company expects cross-selling opportunities to customers in the off-road vehicles and boating segments, which will boost sales and create value for shareholders.

Recreational pontoon is one of the largest and fastest growing segments in the $8 billion powerboats market in the US. The sales in the pontoon boat category have grown at an 11% CAGR since 2010 and Boat Holdings’ pontoon brands, Bennington and Godfrey, have surpassed even this growth rate in the same period. The acquisition opens up new avenues for revenue generation for Polaris in an attractive market segment.

Boat Holdings has a deep understanding and clear focus of the market and customers, and has been able to anticipate the customers’ shift towards high-featured, high-performance luxury boats, across price points. The Company has focused on innovation and constantly improved the performance and quality of its products. Polaris will benefit from this trend and stay ahead of the evolving needs and wants of its customers.

The Company expects the deal to be immediately accretive to its earnings. The deal also has future tax benefits of approximately $100 million. Boat Holdings’ business model is based on fast, flexible production with low fixed assets and capital spending. This will help Polaris maintain strong profit margins and lead to higher cash flows.

About Polaris Industries Inc.

Founded in 1954, Medina, Minnesota-based Polaris is one of the world’s largest powersports Companies. It manufactures a wide range of motorcycles, all-terrain vehicles, and snowmobiles. The Company owns some of the best-selling brands in the industry, including RANGER® utility vehicles, RZR® recreational side-by-sides, Indian Motorcycle®, GEM® electric vehicles, commercial vehicles, military vehicles, and Slingshot® 3-wheel moto-roadster. The Company also offers parts, garments, and accessories as part of its aftermarket portfolio. The Company has presence in over 100 countries and has over 11,000 employees. The Company’s sales were $5.4 billion for FY17.

Stock Performance Snapshot

May 31, 2018 – At Thursday’s closing bell, Polaris Industries’ stock dropped 1.10%, ending the trading session at $111.90.

Volume traded for the day: 633.00 thousand shares.

Stock performance in the last month – up 4.65%; and past twelve-month period – up 33.85%

After yesterday’s close, Polaris Industries’ market cap was at $7.08 billion.

Price to Earnings (P/E) ratio was at 25.16.

The stock has a dividend yield of 2.14%.

The stock is part of the Consumer Goods sector, categorized under the Recreational Vehicles industry.

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