Dive Brief:

• Rumors that sporting goods retailer Cabela’s could be sold have circulated for months, but for the first time the retailer acknowledged as much in documents filed with the Securities and Exchange Commission, although it has not commented on those documents.

• “The results of this strategic alternatives review process could include, but are not limited to, a sale of Cabela’s or one of its businesses, including a sale of the bank or its assets, or a transaction combining a sale of the bank or all or a portion of its assets to one or more purchasers and a sale of the parent company (including all of its merchandising business) to one or more other purchasers,” according to the filing. 

• Cabela's investor Elliott Management last year disclosed an 11% stake in the company and is said to be urging a sale or other ways to unlock value in the struggling retailer, including a real estate sale or spinoff of its credit card business. 

Dive Insight:

For months, privately held Bass Pro Shops—an outdoor retailer quite similar to Cabela’s—has been rumored to be looking into acquiring its rival, working with Goldman Sachs Group’s private equity unit to reach a deal. In addition, the New York Post last week reported that private equity firms Apax Partners and TPG Capital are each meeting with Cabela’s in pursuit of a possible acquisition, although the fact that Cabela’s sells guns has emerged as a controversial aspect of its business in light of increasing mass shootings in the U.S. Some private equity firms have balked at gun-related investments. 

The founding Cabela family still holds a 24% stake in the company, which could impact Elliott Management's reported plans for a sale if the family's opinions do not match with the hedge fund management firm's.

Count financial publication Barron's among those urging Cabela's to complete a sale. "Shareholders should seriously consider taking profits at recent price levels," Barron's said. "Our analysis suggests that any offer isn’t likely to come at much of a premium and that Cabela’s—whether alone or in tandem—still faces many challenges."

The Omaha World Herald notes that Citigroup, Bank of America, Capital One Financial, TD Bank and Synchrony Financial also are taking a close look at Cabela’s credit card business. Since Nordstrom sold its credit card portfolio to a Canadian bank last year, Cabela’s is the only U.S. retailer that still operates a bank in order to issue its own credit cards.