Dive Brief:

• Parent company of Bass Pro Shops and Cabela's, The Great American Outdoors Group, has agreed to acquire Sportsman's Warehouse for $18 in cash per share, according to a press release.
• The parties expect the deal, which is subject antitrust review and a vote by Sportman's Warehouse shareholders, to close in the second half of 2021.
• The deal would bring Bass Pro and Cabela's product brands, including on fishing and hunting gear, to Sportsman's Warehouse, the companies said.

Dive Insight:

In stark contrast to many in the retail world, Sportsman's Warehouse, which operates 112 stores, has had a banner year so far amid the COVID-19 pandemic. 

From January through the end of October, the outdoor retailer's sales increased by more than 61% year over year. CEO Jon Barker told analysts in December that demand was up across all of its categories in the third quarter.

That was driven by increased participation in hunting, camping, fishing and hiking across the country, Barker said, according to a Seeking Alpha transcript. In some states, hunting participation has doubled or tripled, which explains comparable sales increases of nearly 100% in firearms at Sportsman's Warehouse. 

That tracks with other outdoor activities that have gotten a boost during the era of social distancing. Dick's has reported its best-ever sales and earnings this year from consumers buying up outdoor gear along other sporting equipment.

Merging Sportsman's Warehouse with Cabela's and Bass Pro — which together have 169 stores — would create a giant of outdoor sports retail. It comes at the same time as Dick's leaves the hunting market with the exit of its Field & Stream banner in favor of other kinds of outdoor gear, and other retailers back off from firearms to varying degrees.

The deal comes roughly three years after Bass Pro took over Cabela's, bringing together two of the biggest names in the market whose stores are destinations. Johnny Morris, who founded Bass Pro and heads up the parent, Great American Outdoors Group, said in a press release that the aim of bringing the retailers together was to "give our customers a best-of-the-best experience while further uniting them to support conservation."

The acquisition would give Sportsman's Warehouse access to what the companies called the largest selections of fishing tackle and hunting gear, as well as boat and ATV brands, in addition to speeding up product distribution. It will also now offer a price match guarantee on its full assortment.