SIDNEY, Neb. — Cabela’s shareholders have voted to sell the homegrown Nebraska business to Bass Pro Shops, the company announced Tuesday at a special meeting at its headquarters.
The vote brings the outdoors retailer one step closer to consummating its deal with Bass Pro, in which Cabela’s stockholders will receive $61.50 per share.
Roughly 35 people attended the open-and-shut meeting, which lasted 20 minutes. No one asked questions during the question-and-answer session.
About 54 million votes, or 78 percent, were cast in favor of the sale. Most of the remaining shares were not voted, but 155,000 were cast against.
Cabela’s announced last October that its top competitor, Bass Pro, would buy it and consolidate the companies in Bass Pro’s home of Springfield, Missouri.
That leaves Sidney, an isolated town of 6,800 located about six hours west of Omaha, in a possible lurch. It’s still unclear how many of Cabela’s jobs will remain once Bass Pro looks to cut jobs. Cabela’s had employed around 2,000 before several rounds of cost-cutting efforts.
That’s one reason Don Benisek of Sidney said he’s “flat against” the sale, and he voted his shares as such.
He especially protested bonuses for Cabela’s executives, which he called “not right.”
Benisek said he’s concerned for the town he’s called home since 1965, although he plans to stay.
“I just hope Sidney doesn’t go bankrupt,” Benisek said.
He’s been a Cabela’s shareholder since the company went public in 2004.
Elaine Wendler of Lakewood, Colorado, said she also voted her 100 shares of Cabela’s stock against the sale.
“It does sound like they’re going to keep the Cabela name, but for how long?” Wendler said. “It’ll leave a lot of empty buildings.”
Bass Pro said in a statement that the shareholder approval is “an important milestone that brings us one step closer to finalizing this exciting opportunity.”
Bass Pro has said it plans to maintain important bases of operation in Sidney. But in a meeting with Cabela’s employees last year, Bass Pro Chief Executive Johnny Morris said there would be cuts.
“Strategic” buyers like Bass Pro are typically able to pay a higher price to acquire competitors because the company can save money once the deal has closed by eliminating dual functions, such as accounting or human resources departments.
The deal is still awaiting the go-ahead from the Federal Reserve, which has jurisdiction over the sale of Cabela’s credit card operation, World’s Foremost Bank. The bank must be sold before Bass Pro can close on the retail arm of Cabela’s.
Under the deal announced in October, the bank was to be sold to Capital One, and shareholders were to receive $65.50 per share.
But due to an unrelated regulatory issue with Capital One, the bank will instead be sold to Synovus Financial Corp., a Georgia bank that will then offload the credit card receivables to Capital One for a fee. Analysts have called it a clever regulatory workaround.
The merger deadline, when all parties can walk away, is Oct. 3. Cabela’s said it expects the sale to close in the third quarter.
RECENT HISTORY OF CABELA'S
As early as June 4: Cabela’s board and management discuss a sale of the company — or parts of it.
Sept. 24: Cabela’s lays off 4 percent of its corporate workforce, about 70 people, including Sidney Mayor Mark Nienhueser, a vice president.
Oct. 22: Cabela’s announces dismal third-quarter earnings.
Oct. 28: Activist hedge fund Elliott Management reveals an 11.1 percent stake in Cabela’s. It calls for changes, including selling the business.
Nov. 5: Reuters reports that Bass Pro Shops could buy Cabela’s.
Nov. 19: Bloomberg reports that Cabela’s is shopping itself around to private equity firms.
Dec. 2: Cabela’s announces that it will undergo a strategic review, which is often Wall Street speak for selling the company or parts of it.
Jan. 5: Cabela’s changes its bylaws to delay director nominations in 2016, a sign, some say, that Elliott was giving Cabela’s “breathing room” to pursue a sale.
Feb. 9: Cabela’s splits the roles of chief executive and president, promoting Scott K. Williams to president. Tommy Millner remains CEO.
Feb. 10: Chairman Jim Cabela reports to the U.S. Securities and Exchange Commission that he moved about 11.2 million Cabela’s shares into a charitable trust sometime in 2015.
April 28: Cabela’s will pay $1 million to the SEC to settle claims that the Sidney retailer’s chief financial officer, Ralph Castner, misled investors regarding the company’s profitability ratios in 2012. Castner himself also will pay $50,000 to the regulatory agency. As part of the settlement, Castner and Cabela’s did not admit or deny wrongdoing.
May 26: Cabela’s will outsource its division that produces catalogs and other advertising to Quad/Graphics. Quad/Graphics, based in Sussex, Wisconsin, will open a Sidney office in early August.
June 16: Cabela’s acknowledges for the first time that the company — or parts of it — are for sale in a document filed with the SEC.
July: Cabela’s is ranked 491 of the year’s Top 500 U.S. brands, according to the British company Brand Finance, which measures the economic value of commercial names. Cabela’s is valued at $1.2 billion.
August: Elliott Management, the hedge fund that owns a big stake in Cabela’s, now owns about 2.2 million more of the company’s shares than it did at the end of 2015. The recent buys bring Elliott Management’s ownership of Cabela’s to 9.3 percent of the company, up from its initial stake of 8.9 percent. It still has options to buy more — up to about 11 percent of Cabela’s.
Oct. 3: Outdoor gear giants Bass Pro Shops and Cabela’s will combine in a $5.5 billion deal.
December: Federal Trade Commission makes a second request for information about a Bass Pro-Cabela’s deal due to potential antitrust questions.
January: Capital One withdraws bid for Cabela’s credit card operation, World’s Foremost Bank.
April: Cabela’s reaches a proposed deal with Synovus Financial Corp., a Georgia bank, to aid in the sale of World’s Foremost Bank. Also, under the new terms, Bass Pro would pay $61.50 per share to acquire Cabela’s, down from $65.50.
July 5: The FTC, after investigating the deal for possible antitrust violations, approves the sale.
July 11: Cabela's shareholders vote to approve the sale of the company to Bass Pro Shops.
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