Credit card company sale will reportedly slow sale of Cabela’s.
The outdoor industry has been keeping a close eye on Cabela’s since October in anticipation of a possible sale of the outdoor retail giant.
But that sale hasn’t happened yet, and now the New York Post is reporting Cabela’s is trying to sell not its 27-store chain, but their credit card company. The Post, citing unnamed sources, reports Sidney, Nebraska-based Cabela’s wants to sell the company, but retain the profit stream of a credit card business that accounts for 30 percent of the company’s sales.
After that, will Cabela’s reportedly sell the rest of the chain, including the 27 actual brick-and-mortar locations?
It’s an interesting development, especially since there was talk of Springfield, Missouri-based competitor Bass Pro Shops buying the company before the end of last year. But there has been nothing but silence on the possible sale for months now. The Post reports this new development with the credit card company may slow the proposed sale even more.
Cabela’s management has to be feeling the pressure of the situation. The rumors of the sale started back in October when activist investor Elliott Management purchased a stake in Cabela’s and began pushing for a sale.
Cabela’s has been struggling for a while. They laid off 70 people in September and profits and their shares are down recently. The Post reports that Cabela’s doesn’t make as much money as Bass Pro because operations are dated and need to be modernized in order to increase their profits.
It may be a while before there’s any news on a sale of Cabela’s itself. The company has all board positions open, but will not be having board nominations until their annual meeting, which has not yet been set. Meanwhile, the Post is reporting Elliott Management, whose share of the company is 11 percent, may be planning a proxy fight to move things along.
For now it appears we’ll just have to watch and see if the sale of the credit card company goes through first. If you’ve been hoping for a merger and a Cabela’s/Bass Pro Shops superstore, it appears you’ll have to wait just a little while longer.