Polaris hits the water with $805 million deal for Boat Holdings
Polaris CEO Scott Wine
By Mark Reilly
Managing Editor, Minneapolis / St. Paul Business Journal
May 30, 2018
Polaris Industries Inc., a maker of motorcycles, ATVs and snowmobiles, is venturing farther off-road than it's ever been before by buying Boat Holdings for $805 million.
Medina-based Polaris (NYSE: PII) announced the deal for Elkhart, Indiana-based Boat Holdings Wednesday morning. The all-cash deal will include about $100 million in future net tax benefits, meaning that the transaction has a net value of about $705 million in the long term.
Boat Holdings, which is owned by the Vogel family, management and Balmoral Funds, specializes in pontoon and party boats under brand names like Godfrey, Hurricane and Rinker boats. It had a total of about $560 million in sales last year and earnings before interest, taxes, depreciation and amortization of $74 million.
Goldman Sachs & Co. acted as financial adviser to Polaris; the company's legal team was Simpson, Thacher & Bartlett. Stephens Inc. acted as Boat Holdings’ financial adviser and Jones Day acted as legal advisor to Boat Holdings.
Though the deal takes Polaris into a new category, the company said there was a good bit of overlap with its current customer base. The demographics of off-roading and boating fans are similar, and nearly one-third of existing Polaris customers already own a boat. It also offers Polaris a counter-seasonal product to its existing snowmobile business.
“It just makes sense for us to be in the space,” said Polaris CEO Scott Wine in a Bloomberg report on the deal. Several of the company's off-roading rivals, such as Yamaha and Kawasaki, already have boat divisions.
The powerboat industry is about $8 billion in size but didn't have a strong recovery after the Great Recession. Boat Holdings, though, is growing faster than the overall market with a focus on higher-end products. Some Bennington pontoon boats can run between $60,000 and $250,000
2015 Indian Chieftain (Indian Motorcycle Red)
IMRG Membership No. AU101486
Meanwhile back at the Ranch, Tonto disguised as a door gets his knob shot off !!!.