HOLLAND — S2 Yachts Inc. will sell its Pursuit Boats brand in a deal valued at $100 million.
The Holland-based boat manufacturer said today that it entered into an agreement to sell all the assets of its Pursuit Boats brand to Loudon, Tenn.-based Malibu Boats Inc. (Nasdaq: MBUU), a manufacturer of recreational fiberglass boats, according to a statement.
The deal is expected to close in the fourth quarter of this year, subject to closing conditions.
The Fort Pierce, Fla.-based Pursuit Boats makes a line saltwater fishing boats that are powered by outboard motors. The premium boat brand, which was established 41 years ago, generated approximately $124 million in net sales in the 12-month period that ended June 30 of this year, according to a statement.
S2 Yachts, which is owned by the Slikkers family, retains ownership of its Tiara Yachts and Tiara Sport brands, according to CEO Tom Slikkers.
Slikkers described Malibu Boats as “an ideal partner” to position Pursuit for the future, noting the company shared a similar culture and “passion for product and people.”
“This transaction is as much about the right partner to steward Pursuit’s future as it is about the sale price. Malibu is that right partner,” Slikkers said in a statement.
Malibu plans to fund the purchase with cash on hand and debt from its revolving credit facility.
The company said the deal for the Pursuit brand will position it with a premium offering in the growing outboard-powered saltwater fishing boat segment. The addition also expands Malibu’s product offerings, diversifies its end markets and enhances its growth opportunities.
“The Pursuit brand maintains a strong reputation for luxurious appointments, innovation, and premium quality, and this highly complementary business creates strong strategic opportunities to enhance product development across our portfolio of brands,” Malibu Boats CEO Jack Springer stated.
Birmingham-based Angle Advisors LLC served as the financial adviser to S2 Yachts, which was also advised by Grand Rapids-based law firm Varnum LLP.
Malibu Boats was advised in the deal by Raymond James & Associates Inc. and the law firm of O’Melveny & Myers LLP.
The deal comes amid a growth spurt for the boat manufacturing industry, driven by high consumer confidence, more disposable income and generally favorable economic conditions, according to a report from the National Marine Manufacturers Association.
In an annual outlook published in January, NMMA projected sales of powerboats this year will increase 5 percent to 6 percent from the more than 260,000 units sold in 2017, which was the sixth consecutive year of industry growth.
Annual consumer spending in the marine industry hit $37 billion last year, according to NMMA estimates.
As well, S2 Yachts’ sale of the Pursuit Boats brand marks the second transaction involving a Michigan-based boat manufacturer this month.
Previously, Lansing-based Triton Industries Inc., the family-owned manufacturer of Manitou brand of pontoon boats, said it agreed to sell to Quebec-based diversified vehicle and boat maker Bombardier Recreational Products (TSX: DOO), as MiBiz previously reported. Terms of the Triton-BRP deal were not disclosed.