Issue link: http://read.dmtmag.com/i/780450
4 • February 13, 2017 • Powersports Business NEWS www.PowersportsBusiness.com www.powersportsbusiness.com Editorial and Sales: 763.383.4400 Subscriber Service: 847.513.6025 EDITOR IN CHIEF: Dave McMahon 763/383-4411 (dmcmahon@powersportsbusiness.com) MANAGING EDITOR: Liz Keener 763/383-4413 (lkeener@powersportsbusiness.com) ASSISTANT EDITOR: Kate Swanson 763/383-4412 (kswanson@powersportsbusiness.com) DIGITAL MARKETING COORDINATOR: Shauna Spencer MANAGING ART DIRECTOR: Dodi Vessels ASSOCIATE ART DIRECTOR: Nicole Siewert PRODUCTION ARTIST: Kelsey Houle PRODUCTION MANAGER: Angela Schmieg PRODUCTION DIRECTOR: Cherri Perschmann NATIONAL SALES DIRECTOR Allison Gruhn 763/383-4467 (agruhn@powersportsbusiness.com) NATIONAL ACCOUNT MANAGER Mark Rosacker 763/383-4433 (mrosacker@powersportsbusiness.com) NATIONAL SALES REPRESENTATIVE Michael Kula 763/383-4440 (mkula@powersportsbusiness.com) CEO: Marion Minor SR. VICE PRESIDENT/FINANCE & OPERATIONS: Gerald Winkel SR. VICE PRESIDENT/MARKET DEVELOPMENT: Joanne Juda-Prainito GROUP PUBLISHER/MOTORCYCLE, POWERSPORTS: David J. Voll SALES OPERATIONS MANAGER: Bernadette Wohlman CONTRIBUTORS: COLUMNISTS: Paula Crosbie, Steve Jones DEALER ADVISORY BOARD: Hooksett Kawasaki-Polaris, Jim Whalley; Hacker's Yamaha & Honda, Rick Hacker; Honda/Polaris of Lubbock, Morris Baker; All Action Water Sports, Ray Leps POWERSPORTS BUSINESS (ISSN #1522-7944) is published monthly except twice in May and November plus the Market Data Book in May, 15 times per year by EPG Media/Specialty Information Media, 10405 6th Avenue North, Suite 210, Minneapolis, MN 55441. Periodicals postage paid at St. Paul, MN and additional mailing offices. POSTMASTER: Send address changes to Powersports Business, P.O. Box 2123, Skokie, IL 60076-7823. SUBSCRIPTION INFORMATION: Free to qualified members of the motorcycle, all-terrain vehicle, snowmobile and personal watercraft industries. Annual subscription rate is $56 per year for U.S residents, $76 for Canadian residents and $96 for residents in other countries. All paid subscriptions must be paid in advance and in U.S. funds only. CUSTOMER SERVICE: Visit www.PowersportsBusiness.com, email customerservice@epgmediallc.com, call (847) 513-6025, fax (763) -383-4497 or write to Powersports Business, PO Box 2123, Skokie, IL 60076-7823. CANADIAN RETURN ADDRESS: EPG Media & Specialty Information, 4960-2 Walker Road, Windsor, Ontario N9A 6J3. Publication Sales Agreement #40012332. EDITORIAL: All manuscripts, materials, photographs and artwork submitted are at mailer's risk and must include self-addressed envelope with sufficient postage for return. Send editorial materials to EPG Media/Specialty Information Media, 10405 6th Avenue North, Suite 210, Minneapolis, MN 55441, 763/383-4400. No responsibility will be assumed for unsolicited materials. Powersports Business is a registered trademark of EPG Media & Specialty Information. Copyright 2017 by EPG Media & Specialty Information. All rights reserved. Reproduction in whole or part is prohibited unless expressly authorized by publisher. REPRINTS: For more information on e-prints or reprints from Powersports Business, contact Robin Cooper, 763/383-4400 ext. 4491. Printed in U.S.A. FEBRUARY 2017 6-7: Gart Sutton & Associates Service Management Workshop, Dallas, TX 8-11: U.S. X-Country Snowmobile Racing I-600 Winnipeg to Willmar, MN 9-10: Tucker Rocky | Biker's Choice Dealer and Brand Expo, Embassy Suites Dallas Frisco Hotel Convention Center & Spa, Frisco, TX 10-12: Progressive International Motorcycle Show, Donald E. Stephens Convention Center, Rosemont, IL 10-12: The One Show, Portland, OR 10-12: Timonium Motorcycle Show, Maryland State Fairgrounds, Timonium, MD 11: Monster Energy Supercross AT&T Stadium, Arlington, TX 11-12: North Carolina Motorcycle Dealers Association Winter Meeting, Greensboro, NC 11-12: Texas Motorcycle Dealers Association Annual Conference, Courtyard Marriott Downtown/ Convention Center, Austin, TX 11-12: AMA ISDE East Qualifier Series Round 2, Full Gas Enduro Series, Gaston, SC 12: 13th Annual Hot Products IJSBA Mark Hahn Memorial Havasu 300 Mile National Team Endurance Race presented by Yamaha, Crazy Horse Campground, Lake Havasu City, AZ 13: Ohio Motorcycle Dealers Association Annual Meeting, Crowne Plaza Hotel, Dublin, OH 17-19: AMA Ice Race Grand Championship, Cadillac, MI 17-19: MCN London Motorcycle Show, Excel London, London, UK 17-19: Mama Tried Motorcycle Show, Milwaukee, WI 18: Monster Energy Supercross U.S. Bank Stadium, Minneapolis, MN 18-19: Parts Unlimited/Drag Specialties 2017 NVP Product Expo, Lucas Oil Stadium, Indianapolis, IN 22-23: Kimpex Show, Levis Convention Center, Levis, Quebec 24-25: AMSOIL Soaring Eagle Snocross National, Mt. Pleasant, MI 25: Monster Energy Supercross, Georgia Dome, Atlanta, GA 25-26: U.S. X-Country Snowmobile Racing Seven Clans Warroad 200, MN 25-26: AMA ISDE East Qualifier Series Round 3, Full Gas Enduro Series, Greeneville, TN 27-28: Gart Sutton & Associates Dealership Management for GM or DP, Dallas, TX 27-28: Gart Sutton & Associates Advanced Sales and F&I Management, Dallas, TX 28-March 4: Bintelli Dealer Meeting, The Bahamas MARCH 2017 3-4: Martin Moto Modern Classics Motorcycle Show, Boyertown, PA 3-4: AMSOIL Theisen's Snocross National, Dubuque, IA 4: Monster Energy Supercross Rogers Centre, Toronto, Ontario 4-5: U.S. X-Country Snowmobile Racing Naytahwaush 200, MN 10-19: Bike Week, Daytona Beach, FL 11: Monster Energy Supercross Daytona International Speedway, Daytona Beach, FL 11-12: AMA ISDE West Qualifier Series Round 2, Boise Ridge Riders, Payette, ID 17-19: AMSOIL Ram Trucks Snocross Grand Finale, Lake Geneva, WI 18: Monster Energy Supercross Lucas Oil Stadium, Indianapolis, IN 25: Monster Energy Supercross Ford Field, Detroit, MI 25-26: 30th annual Donnie Smith Bike & Car Show, RiverCentre, St. Paul, MN CALENDAR OF EVENTS Email dmcmahon@powersportsbusiness.com to get your industry event added to the calendar. Cat a 'superb strategic fit' for $13 billion company Arctic Cat Inc. announced in January that it has signed a definitive merger agreement under which Textron Inc. will acquire Arctic Cat in a cash transaction valued at approximately $247 million, plus the assumption of existing debt. Under the terms of the agreement, which was unanimously approved by the Arctic Cat Board of Directors, Textron, through a wholly owned subsidiary, will commence a tender offer to purchase all outstanding shares of Arc- tic Cat at $18.50 per share in cash, representing a 40.7 percent premium to the closing price of Arctic Cat's common stock on January 20, 2017. Arctic Cat anticipates that tender offer materials will be provided to shareholders no later than February 7, 2017. The completion of the acquisition is subject to customary condi- tions and regulatory approvals. "Arctic Cat's board believes that Textron's offer delivers compelling and immediate value to our shareholders," said Christopher Metz, Arctic Cat's president and chief executive officer. "This transaction presents increased opportunities for the business to leverage our combined scale, accelerate growth and enhance product innovation in ways that will benefit our customers, dealers and employees." Textron is a multi-industry company with more than $13 billion in annual revenues and approxi- mately 35,000 employees. Arctic Cat will become part of Textron's Specialized Vehicles business, maintaining its iconic Arctic Cat brand, as well as its current manufacturing, distribution and operational facilities, with a focus on growing the business. Arctic Cat and Textron Specialized Vehicles have complementary product portfolios of rec- reational, utility and specialized vehicles. The combined businesses will be well positioned to be a powersports industry leader with a wider product lineup, and allow for more aggressive investment in product development, dealer networks, marketing and customer service. Metz added: "We are proud of the progress our team has made to lay the foundation for Textron to continue taking this company for- ward. Textron plans to build on Arctic Cat's strong brand and history of innovation. We expect many Arctic Cat employees to benefit from expanded career opportunities as part of a larger, more diversified company. On behalf of the Arctic Cat board and management team, we thank our dedicated employees for their hard work, commitment and pride in making Arctic Cat an enduring competitor and beloved brand in the powersports market. We are excited about Arctic Cat's future." "Arctic Cat is a superb strategic fit for Tex- tron," said Textron chairman and CEO Scott C. Donnelly. "With our recent product intro- ductions in the outdoor recreational vehicle market under the Stampede name, we believe Arctic Cat, one of the most recognized brands in the industry, provides an excellent platform to expand our portfolio, increase our distribu- tion and create growth within our Specialized Vehicles business." Textron's Specialty Vehicle business include the following: Golf — E-Z-GO, Cushman, Jacobsen Turf — Jacobsen, Ransomes, Dixie Chopper Consumer — Bad Boy Off Road, E-Z-GO Ground Support — Textron Ground Support Equipment Commercial — Cushman Aftermarket — E-Z-GO, Cushman, Bad Boy Off Road, Pro-Fit, Jacobsen On the same day as the acquisition announcement, Textron reported fourth quarter 2016 income from continuing opera- tions of $0.78 per share compared to $0.81 per share in the fourth quarter of 2015. Dur- ing this year's fourth quarter, the company recorded an $8 million pre-tax restructuring charge ($0.02 per share, after-tax). Excluding this item, adjusted income from continu- ing operations, a non-GAAP measure that is defined and reconciled to GAAP in an attach- ment to this release, was $0.80 per share for the fourth quarter of 2016. Revenues in the quarter were $3.8 billion, down 2.5 percent from the fourth quarter of 2015. Textron segment profit in the quarter was $391 million, up $13 million from the fourth quarter of 2015. "Overall, revenues were down in the quar- ter, but we were encouraged by increasing demand at Industrial and strong operating performance at Bell," Donnelly said. "We also completed the first flight of our production Scorpion jet as we continued to ramp invest- ment in this program to position us to compete for opportunities in 2017." Textron intends to update its 2017 outlook to include Arctic Cat following the completion of the transaction. Donnelly continued, "Our outlook reflects the continuation of our strategy around organic growth through new product investments amid challenging end markets. As we transition our product portfolios to comprise a greater percentage of these new offerings, we'll expect improvement in our growth rate and margins over the longer term." PSB Arctic Cat to be acquired by Textron for $247 million "We are proud of the progress our team has made to lay the foundation for Textron to continue taking this company forward. Textron plans to build on Arctic Cat's strong brand and history of innovation," Arctic Cat president and CEO Christopher Metz said.