Earlier this week, Bass Pro Shops announced the finalization of its years-long acquisition of Cabela’s. Bass Pro Shops founder Johnny Morris called the merger the beginning of a new era for both companies. However, consumers and vendors alike are still left with a cavalcade of questions regarding the deal. Today, FTR has delved into our archive of merger coverage to answer some of those questions:
1. Will Cabela’s stores become Bass Pro Shops stores?
There is no indication that any Cabela’s stores will be rebranded as Bass Pro Shops in the near term. Morris has stated that he intends to leverage the Cabela’s brand, and that business will continue “as usual” for now. Furthermore, a rebranding move would require a massive investment in resources, while potentially further alienating a loyal Cabela’s consumer base. Morris has a history of acquiring rival brands, and a 2014 acquisition of Ranger and Triton did not see a major rebrand for either company.
2. What happens to Cabela’s headquarters?
Sidney, Nebraska—population 6,800—has been the home of Cabela’s for decades. Bass Pro Shops says the headquarters there, which employs nearly 2,000 people, will remain open. Duplicate roles, however, will move to Bass Pro Shops headquarters in Springfield, Missouri.
3. Will the company be publicly traded?
For now, no. While Cabela’s was a publicly traded company, Bass Pro Shops is a private entity that answers to Johnny Morris. That should remain the case for the foreseeable future, as Morris himself has stated that the company will remain private.
4. Does the combination constitute a monopoly?
Legally, no. In addition to a Federal Trade Commission approval of the deal, any argument for a monopoly could be counteracted by the presence of other major retailers in the sporting goods market. Academy Sports, Dick’s Sporting Goods, a resurrected Gander Mountain and even Walmart are all considered sporting goods vendors. That means despite operating more than 170 combined stores, Bass Pro Shops and Cabela’s have plenty of rivals … at least in theory.
In the U.S., the Sherman Antitrust Act (1890) defines monopoly power as the ability of a business to control a price within its relevant product market, or to exclude a competitor from doing business within that market. As long as major competitors still exist, Morris’ empire doesn’t completely possess those powers.
5. What happens to the Cabela’s credit card business?
Synovus Financial announced the close of the final linchpin in the transaction on September 25. That deal, which netted a $75 million fee for Synovus, created a liaison between Capital One Bank and the Cabela’s-owned Worlds Foremost Bank. Capital One now owns the Cabela’s credit card portfolio.
6. What about private label products?
In June, American Rod and gun announced they’d stop selling Bass Pro Shops brand items to independent retailers. And while there’s no danger of Bass Pro Shops private brands going away—at least in their own stores—consumers are expressing concern about Cabela’s products. For now, Cabela’s private label products will remain on store shelves. Bass Pro Shops has stated that they will continue to grow both brands; however, it’s speculated that Bass Pro Shops could reserve some of the most prestigious products for their own label.
7. Will my local Cabela’s store close?
Cabela’s operates 82 stores in the U.S. and Canada. Bass Pro Shops operates 95 in that same territory; however, there is relatively little overlap. At this time, Bass Pro Shops has not announced the closing of any Cabela’s stores.