BPS Cabela's merger update thread

[blckshirt98]

17 hours ago, Mosster47 said:

 

If BPS stays with their insane prices and shipping costs Tackle Warehouse will lap them by 2020, and they should.

 

The problem with this is that TW isn't in the mind of non-enthusiasts new to the sport or to the average family trying to head off into the mountains for camping/hiking/fishing/hunting.  My neighbor and co-workers know about BPS and they don't fish or camp.  BPS has marketed themselves as a "one stop outdoor shop" where people feel they can just go and get everything they need where people feel they're getting a good price/deal.  It's like people who still go to Barnes & Nobles for books when they can get a book for 30-40% cheaper on Amazon.

[OperationEagle]

Latest...

 

Bass Pro Shops' $4.5 billion Cabela's Deal Gets White Knight

Published March 29, 2017

The Wall Street Journal

A small Georgia bank has emerged as the potential savior of Bass Pro Shops's $4.5 billion takeover of outdoor-goods retailer Cabela's Inc., according to people familiar with the matter. 

 

The deal, struck in October, had two parts: Bass Pro agreed to buy the retail business of Cabela's, while Capital One Financial Corp. agreed to acquire its banking operation, which issues store-branded credit cards. 

 

But the deal ran into trouble after Capital One, one of the country’s largest credit-card companies, said it wouldn't be able to get timely regulatory approval, amid investigations into its anti-money laundering controls. 

 

Cabela's is now in talks to sell that business to Synovus Financial Corp., a Georgia-based bank with about $30 billion in assets and 250 branches across the south, the people said. 

 

Under the plan being discussed, Synovus would resell the credit-card portfolio to Capital One and keep the roughly $1 billion in deposits held by the Cabela's bank, the people said. That could avoid an in-depth regulatory review for Capital One and allow the deal to be completed faster, they said. 

 

Closely held Bass Pro would still buy the retail business, which generated $3.6 billion in revenue last year selling everything from crossbows to boats. It has financial backing from Goldman Sachs Group Inc. and others. 

 

The talks, which have been fitful, remain ongoing and may not be finalized, the people said. 

 

[greentrout]

BPS should drop this deal like a hot potato. Brick & mortar in stand alone & big sprawling malls is not the future. Cash out the window. The industry has cannibalized itself.

 

Can't see how this helps BPS.

[OperationEagle]

Retail is in a state of transition for sure. The bps and cabelas stores are large and expensive footprints. 

 

The key to success is ... I think...which may be obvious...whether they can drive enough volume to maximize inventory turns and demand the lowest prices from manufacturers to gain lowest cost advantages.  

 

There will always be a need for bricks and mortar especially when you have items that aren't conducive to web based purchasing...such as boats and other large more substantial gear.

 

This is such an interesting business case unfolding in front of us...even more fascinating because we are active participants and recipients of its outcome. 

 

 

[smalljaw67]

46 minutes ago, greentrout said:

BPS should drop this deal like a hot potato. Brick & mortar in stand alone & big sprawling malls is not the future. Cash out the window. The industry has cannibalized itself.

 

Can't see how this helps BPS.

 

Cabela's is behind Bass Pro Shops but Cabela's has a more loyal customer base. Cabela's also has a better credit card rewards program and higher quality clothing along with a better reputation on overall customer service. BPS will gain market share that they couldn't get before, a survey conducted in 2003 found that 8 out of 10 BPS customers also had made purchases at Cabela's while only 6 in 10 customers of Cabela's made purchases from BPS. They found outdoor clothing buyers overwhelmingly favored Cabela's branded outdoor apparel over BPS and the customer satisfaction rate was also a lot higher with Cabela's, in fact the only area BPS beat Cabela's was in selection. So what benefit is it to have the Cabela's brand? Well the benefit is capturing market share they were unable to get before, I hope the points system Cabela's has in place with the credit card stays the same. They say it will be in place but the terms are what I'm worried about, right now you can let your Cabela's points ride as long as you want, I've let them build up until I can get something nice, about 2 or 3 years worth, with BPS you have 1 year from your first point to use the points or you lose them.

[OperationEagle]

Hawg great insights.  I first thought the difference in cross purchasing was due to number of locations for each...but cabelas has 82 and bps has 94 locations...so pretty similar. 

 

This might reinforce that that loyalty is higher with cabelas customers. Hope this means they will maintain the cabelas brand and product lines that have helped cabelas earn this loyalty. 

[Deleted account]

22 minutes ago, OperationEagle said:

This might reinforce that that loyalty is higher with cabelas customers. Hope this means they will maintain the cabelas brand and product lines that have helped cabelas earn this loyalty. 

 

Seeing how all that "loyalty" led them to insolvency, I think not. I see BPS using Cabela's much like DSG uses it's new division Field&Stream.

[OperationEagle]

2 hours ago, reason said:

 

Seeing how all that "loyalty" led them to insolvency, I think not. I see BPS using Cabela's much like DSG uses it's new division Field&Stream.

 

 

There are many things that contribute to insolvency.  Poor mix, margin/pricing, and expense management being just a few.

 

But did I miss something?  Is cabelas insolvent?  Shame on me if I didn't catch that...