MINNEAPOLIS–(BUSINESS WIRE)–June 16, 2022–
Polaris Inc. (NYSE:PII), the global powersports leader, today announced that it has entered into a definitive agreement to sell its Transamerican Auto Parts (TAP) business to Wheel Pros, a designer, manufacturer and distributor of powertrain enhancements. exclusive brand replacement vehicles. for light trucks, SUVs, passenger cars and ATVs/UTVs backed by Clearlake Capital Group, LP (together with its subsidiaries, “Clearlake”) and in partnership with management. The transaction includes TAP’s full portfolio of operations, including all brands, product lines, manufacturing operations, distribution facilities, more than 100 4 Wheel Parts outlets and more than 1,700 TAP employees.
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“We have a clear vision to be the world leader in motorsports,” said Mike Speetzen, CEO of Polaris. “Our decision to divest TAP allows us to better capitalize on growing consumer interest and demand for our powersports offerings, while allowing Polaris to focus our time, people and resources on our core on-road businesses. , off-road and marine, as well as the parts, apparel and accessory brands that support these customers. Furthermore, it supports our long-term financial objectives and should have a positive impact on the EBITDA margin. TAP remains a leading omnichannel player in the Jeep and truck aftermarket, and we appreciate the contributions the team has made to Polaris.
The transaction is estimated to generate an additional $135 million in cash flow for Polaris in the second half of 2022. This includes the purchase price from the buyer and the realization of the cash tax benefits associated with the sale, less fees estimated transactions. The sale price, net of cash, debt and other costs, is estimated at $50 million. In 2021, Polaris’ Aftermarket segment generated $930 million in revenue, of which TAP business accounted for nearly $760 million. The transaction is expected to close early in the third quarter, subject to customary closing conditions.
In connection with the conclusion of a definitive agreement for the sale of TAP, the TAP business has met the accounting criteria to be classified as assets held for sale and discontinued operations. As part of the transaction, Polaris expects to record an impairment charge, net of tax, of approximately $140 million.
Baird acted as financial advisor and Jones Day acted as legal advisor to Polaris on the transaction.
As a global powersports leader, Polaris Inc. (NYSE:PII) is at the forefront of product breakthroughs and rewarding experiences and services that have invited people to experience the joy of being outdoors. since our founding in 1954. With annual sales of $8.2 billion in 2021, Polaris’ high-quality product line includes the Polaris RANGER®, RZR® and Polaris GENERAL™ side-by-side all-terrain vehicles; Sportsman® all-terrain off-road vehicles; military and commercial off-road vehicles; snowmobiles; Indian Motorcycle® mid-size and heavy-duty motorcycles; Slingshot® motorcycle roadsters; Aixam quadricycles; Goupil electric vehicles; and pontoon and deck boats, including the industry-leading Bennington pontoons. Polaris enhances the riding experience with parts, apparel and accessories. Proudly based in Minnesota, Polaris serves over 100 countries worldwide. www.polaris.com
Except for historical information contained herein, matters set forth in this presentation and discussed in the related earnings call are “forward-looking statements” intended to qualify for the safe harbor provisions of the Private Securities Litigation Act. Reform Act of 1995. These forward-looking statements can generally be identified as such because the context of the statement will include words such as we or our management “believe”, “should”, “anticipate”, “expect”. , “esteem” or words of similar significance. Likewise, statements that describe our future plans or trends, objectives or goals, such as future sales, shipments, inventory levels, consumer demand, net income, net earnings per share, cash flow future and capital requirements, operational initiatives, pricing actions, prices, currency fluctuations, interest rates and raw material costs, are forward-looking statements that involve certain risks and uncertainties that could so that actual results differ materially from these forward-looking statements. Potential risks and uncertainties include factors such as the severity and duration of the COVID-19 pandemic and the resulting impact on the Company’s business, supply chain and global economy; the Company’s ability to successfully implement its manufacturing and supply chain operations expansion initiatives; the Company’s ability to successfully source necessary parts and materials and the Company’s ability to manufacture and deliver products to dealers to meet growing demand and to restore dealer inventory levels to optimal levels ; continued growing consumer demand for the Company’s products; competitors’ product offerings, promotional activities and pricing strategies; economic conditions affecting consumer spending; disruptions in manufacturing facilities; product recalls and/or warranty costs; product redesign costs; the impact of changes in the Polaris stock price on incentive compensation plan costs; exchange rate fluctuations; environmental and product safety regulatory activity; weather effects; commodity costs; transportation costs and tariff costs (tariff relief or ability to mitigate tariffs); changes to international trade policies and agreements; uninsured product liability claims; uncertainty in the retail and wholesale credit markets; performance of affiliate partners; tax policy changes; relationships with dealers and suppliers; and the general economic, social and political environment. Investors are also urged to consider other risks and uncertainties discussed in the Company’s filings with the Securities and Exchange Commission. The Company assumes no obligation to anyone to provide updates to its forward-looking statements.
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KEYWORD: MINNESOTA UNITED STATES NORTH AMERICA CANADA
INDUSTRY KEYWORD: RECREATIONAL VEHICLES PERFORMANCE & SPECIAL INTERESTS SPORTS MOTORCYCLES OFF-ROAD TRUCKS & SUVS OUTDOOR MOTORCYCLES MOTORSPORTS AUTOMOTIVE GENERAL AUTOMOTIVE AUTOMOTIVE MANUFACTURING MANUFACTURING
SOURCE: Polaris Inc.
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PUBLISHED: 06/16/2022 16:30 / DISK: 06/16/2022 16:32