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Vista Outdoor (NYSE:VSTO) rose 2% in after hours trading after Colt CZ Group proposed a business compation that would value Vista at $30 a share.
Vista Outdoor holder Colt’s plan includes a $900 million buyback that would be executed post-closing, funded by $600 million of new equity issued at the transaction price and an incremental $300 million of debt, according to a letter Colt wrote to Vista’s board on Wednesday. Colt has a 5.7% stake in Vista, according to its latest 13D filing.
“We would keep the company together, allowing continued upside for current Vista shareholders with the “New Vista” retaining its listing in the U.S..” Jan Drahota, CEO of Colt wrote in the letter.
Under the proposal, Vista (VSTO) holders would own about 55% of new Vista post-closing. according to the letter. The new company would have post transaction net leverage of about 1.8x LFY adjusted EBITDA.
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