Compass Diversified (CoDi), the Westport, Connecticut-based owner of several sporting goods brands, including Boa Technology, 5.11, PrimaLoft and Velocity Outdoor, announced that it has entered into a definitive agreement to sell its majority-owned subsidiary Wheelhouse Holdings, Inc, the parent company of Marucci Sports, to publicly traded chassis and suspension expert Fox Factory Holding Corp, owner of several two-wheeler brands, including Easton Cycling, Fox, Marzocchi and Race Face.
The agreement calls for Marucci to be sold to Fox Factory, based in Duluth, Georgia, for an enterprise value of $572 million, subject to certain working capital adjustments and other factors. CoDi expects to record a pre-tax gain on the sale of $225 million to $245 million. Proceeds from the transaction will be used to repay outstanding debt and for general corporate purposes.
CoDi acquired Baton Rouge, Louisiana-based Marucci in April 2020 for $200 million. “This was at a time when few transactions were being completed due to the pandemic, yet our flexible capital structure allowed us to execute in times of uncertainty and generate value for our shareholders,” said Elias Sabo, CEO of CoDi. He went on to say that since then, Marucci’s core business has grown, gained share in new markets such as fielding gloves and softball, and expanded its product portfolio through the acquisitions of Lizard Skins and Baum Bat. Kurt Ainsworth, co-founder and CEO of Marucci Sports, commented, “We are grateful for our partnership with the CoDi team and look forward to further growth under Fox’s ownership. […] We look forward to leveraging their innovation and growth success as we expand our sales reach and breadth.” Although Marucci specializes mainly in batting sports such as baseball and softball, it also offers, among other things, cycling gloves as well as Lizard Skins grip tapes and slip-on rubber grips for bicycle handlebars.
Closing of the transaction is subject to customary conditions, including regulatory approval, and is expected to occur in November 2023.
