Polaris buys four boat brands

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Bennington is one of four boat brands sold to Polaris Industries as part of Boat Holdings. Shown here is Bennington’s QX27 10-foot Wide-Beam Fastback Pontoon.  

Bennington is one of four boat brands sold to Polaris Industries as part of Boat Holdings. Shown here is Bennington’s QX27 10-foot Wide-Beam Fastback Pontoon.  

Polaris Industries Inc. is entering the boat business with the purchase of Boat Holdings LLC from the Vogel family for $805 million.

Polaris, which is publicly traded on the New York Stock Exchange, made the announcement today that it has signed a definitive agreement to make an all-cash purchase of the largest U.S. pontoon manufacturer with four brands — Bennington, Godfrey, Hurricane and Rinker. Hurricane builds fiberglass deck boats and Rinker makes runabouts, cruisers and deckboats. The group generated about $560 million in sales last year.

“Following the closing of the transaction, Boat Holdings will operate as a distinct business unit reporting to Bob Mack, senior vice president of corporate development and strategy, and president of global adjacent markets at Polaris,” Polaris corporate communications manager Jessica Rogers told Trade Only today in an email.

The company will maintain its headquarters and manufacturing facilities in Elkhart, Ind., and its experienced management team will remain in place, including chairman Steve Vogel and CEO Jacob Vogel.

“This will be a new segment for Polaris,” Rogers said. “We were in jet skis nearly 15 years ago.”

He continued, “The addition of Boat Holdings and its brands broadens and diversifies our range of powersports offerings, and offers compelling financial benefits and growth opportunities both now and in the future. The Boat Holdings and Polaris team will work closely to help deliver synergies and capture opportunities, be them organically or inorganically, to accelerate profitable growth.”

Bennington acquired Godfrey, Hurricane and Rinker in 2015, as well as Polar Kraft aluminum fishing boats, which the Vogels sold in 2016 to two RV industry veterans.

The four brands are strategically positioned with over 200 base models across a range of price points and fully-custom built options, Polaris said.

Boat Holdings leverages “an asset-light” manufacturing model, and offers boats through a network of dealers primarily in the United States and Canada.

When adjusted for the net tax benefit of $100 million, the transaction is valued at approximately $705 million. The 2017 Boat Holdings EBITDA multiple including the expected net tax benefits is approximately 9.5 times. The transaction is expected to close in the third quarter of 2018 and is subject to customary closing conditions.

“Boat Holdings is renowned for innovation and quality and we are excited to have them become part of our portfolio of industry-leading powersports vehicles,” said Polaris chairman and CEO Scott Wine in a statement.

“This transaction epitomizes our disciplined growth strategy of entering attractive markets where we can establish and extend our leadership position,” said Wine. “In addition to market share leadership, Boat Holdings expands Polaris’ footprint in the recreational outdoors market, commanding more of consumers’ discretionary spending.

Boat Holdings is “a strong cultural fit” with Polaris, Wine said.

“Further, Boat Holdings’ long-term relationships with its national dealer network speaks to the brand’s strength with both dealers and consumers,” Wine said.

“Over the past 20 years, Boat Holdings has established premier brands synonymous with innovation and quality through its broad portfolio of boats, unmatched dealer network and commitment to our customers,” said chairman Steve Vogel. “With similar cultures, both businesses share the same passion for product and people, which has driven both our and their long-term success. As a trailblazer in its own right, Polaris is the perfect partner as we look to drive continued expansion and growth in this attractive segment.”

“We look forward to Boat Holdings’ best-in-class management team and skilled and experienced workforce joining the Polaris family,” Wine said. “Together, we believe we can increase shareholder value driven by ongoing innovation and growth, as we further leverage their unique position within the large and growing boating industry.”

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