Vista Outdoor Inc. ( VSTO ) shares are trading higher Monday morning. The company announced its Board of Directors has rejected an unsolicited acquisition proposal from MNC Capital.

The revised proposal, received on June 6, 2024, offered an all-cash transaction of $39.50 per Vista Outdoor ( VSTO ) share. Following a detailed assessment, the Board determined that MNC’s offer was not superior to the existing merger agreement with Czechoslovak Group a.s. (CSG).

After consulting with financial and legal advisors, Vista Outdoor’s Board concluded that MNC’s proposal undervalued the company.

The Board’s letter to MNC highlighted that the offer did not present a better financial outcome for Vista Outdoor ( VSTO ) shareholders compared to the CSG merger agreement. Therefore, the Board has officially rejected MNC’s latest indication of interest.

In a separate announcement, Vista Outdoor ( VSTO ) confirmed receiving a $2+ billion indication of interest from a U.S.-based private investment firm regarding The Kinetic Group.

The Board believes this offer could lead to a superior proposal and meets the engagement criteria under the CSG merger agreement.

The alternative party stated that it would commit to fully supporting the purchase price and is prepared to execute definitive agreements no later than June 14, 2024.

Meanwhile, the $47.75 million break fee payable to CSG in the event that Vista Outdoor ( VSTO ) is determined to terminate the merger agreement and enter into a transaction with the alternative party will be payable by Vista Outdoor ( VSTO ).

Vista Outdoor ( VSTO ) remains committed to the terms of the CSG merger and continues to endorse CSG’s acquisition of The Kinetic Group.

Vista Outdoor ( VSTO ) filed a supplemental presentation with the U.S. Securities and Exchange Commission (SEC), detailing its extensive engagement with MNC and justifying the Board’s decision to reject MNC’s offer.

The Board emphasized its dedication to ensuring the best financial outcomes for its shareholders through rigorous evaluation processes.

The company will adjourn the special meeting of stockholders scheduled to be held at 9:00 am (Central Time) on June 14, 2024, to 9:00 am (Central Time) on July 2, 2024. 

Price Action: VSTO shares are trading higher by 0.85% at $36.09 at the last check Monday.

Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.