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Why Shares of Sportsman’s Warehouse Are Surging Nearly 40% Today

Shares of Sportsman’s Warehouse Holdings Inc. are surging following news of its acquisition by Great American Outdoors Group.

A statement last night revealed that the Springfield, Mo.-based company — parent to Bass Pro Shops, Cabela’s, White River Marine Group and a collection of nature-based resorts — agreed to acquire Sportsman’s Warehouse for $18 per share in cash. The transaction is expected to close in the second half of next year, subject to an antitrust review and approval by Sportsman’s Warehouse’s shareholders.

As of 1:30 p.m. ET, SPWH stock was up more than 38.5% to $17.53.

“This merger brings together the greatest brands in the outdoor industry,” said Sportsman’s Warehouse CEO Jon Barker. “As we look to the future, the combined entities provide our passionate associates with greater opportunities to serve the outdoor enthusiast … We look forward to a smooth transition and building our partnership.”

Sportsman’s Warehouse was founded in West Jordan, Utah, more than 30 years ago. It has since expanded to 112 locations and employs about 8,000 workers. Beyond hunting, shooting, fishing and camping gear, the company also sells apparel and footwear from brands like Ariat, Crocs, Merrell and Under Armour.

As part of the agreement, the Great American Outdoors will remain a private company. According to the statement, the driving force between the partnership is the similar histories between the two enterprises as well as their “highly complementary” business philosophies and geographic footprints.

“As outdoor sports specialists with unwavering dedication to people who fish, hunt and enjoy the outdoors, we greatly admire the passionate team at Sportsman’s Warehouse for their commitment to their customers and the sports we all love,” added Bass Pro Shops founder and Great American Outdoors Group leader Johnny Morris. “By combining our best practices, our aim is to give our customers a best-of-the-best experience while further uniting them to support conservation.”

Amid lockdowns spurred by the coronavirus pandemic, Sportsman’s Warehouse — like a number of sporting goods retailers across the country — has benefited from the fact that more consumers are participating outdoor and fitness activities. From mid-March through the end of the third quarter, the retailer reported a “significant increase in sales.” Revenues for the 39 weeks ended Oct. 31 improved 61.3% to $1.01 billion. Comps during the same timeframe jumped 44.4%, driven by hunting and shooting merchandise.

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