OMAHA, Neb. — Outdoor gear giant Bass Pro is snapping up rival Cabela’s in a $4.5 billion deal announced Monday.
Bass Pro is paying Cabela’s shareholders $65.50 cash per share, a 19 percent premium to Friday’s closing price. The companies valued the deal at $5.5 billion, which includes debt. The deal combines two companies known for their giant destination superstores.
It also creates uncertainty about jobs in Cabela’s home state of Nebraska. The combined companies plan to keep some operations in Sidney and Lincoln, Neb., but it’s not immediately clear how many jobs might be lost.
Cabela’s employs about 2,000 people in the Nebraska town of Sidney, which has about 7,000 residents. State Sen. Ken Schilz, who represents the area, said the deal is concerning because of the duplication between the two companies’ headquarters that will be eliminated.
“We’ll just have to wait and see what Bass Pro does. I’m sure most folks in Sidney are pretty nervous this morning,” Schilz said.
Activist investment firm Elliott Management began pushing for significant changes at Cabela’s last fall. Elliott owns 7.4 percent of Cabela’s shares and holds options to buy another 3.8 percent.
A sale of the Cabela’s has been a possibility ever since the company announced a review of its strategic options last December, but many in Sidney weren’t ready to believe it could happen.
“We’re just trying to absorb it right now,” said Denise Wilkinson, president of the Cheyenne County Chamber of Commerce. “We just never knew what would happen.”
Bass Pro founder and CEO Johnny Morris said he hopes to continue growing the Cabela’s brand alongside his privately-held Springfield, Mo., based chain.
“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.”
Capital One will take over running Cabela’s credit card unit as part of the deal.
Nebraska politicians are encouraging Bass Pro to maintain significant operations in the state after the deal closes sometime in the first half of next year.
U.S. Rep. Adrian Smith said Cabela’s has long been “a cornerstone of western Nebraska’s economy.”
Cabela’s shares climbed $8.19, or 14.9 percent, to $63.12 in afternoon trading Monday.