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Update 7pm: Add MarineMax response.
MarineMax (New York Stock Exchange: HZO) rose by 4% in after-hours trading after Island Capital Group offered to buy a 100% stake in the company's yacht and marina business.
Island Capital Group, led by Andrew L. Farkas, who sold the YRMS business For MarineMax (HZO) in 2022 for $480 million, wants to buy back the unit from the company, according to a statement on Tuesday.
Island Capital is looking to engage with MarineMax (HZO) immediately and believes a deal could be completed in as little as 60 to 90 days.
“We propose to acquire the YMRS assets at a double-digit EBITDA valuation multiple, while the company currently trades in a range of 5-6 multiples,” Farkas wrote in a letter to MarineMax shareholders on Tuesday. “Therefore, our proposal could create significant value for shareholders.”
Island Capital's offer comes after Bloomberg reported just over a month ago that OneWater Marine (ONEW) is in talks to buy its larger rival, MarineMax (HZO), in an all-cash deal.
MarineMax (HZO) said it received the letter from Island Capital and will review it.
“MarineMax's Board of Directors is open-minded and regularly evaluates good faith opportunities to enhance shareholder value,” a MarineMax spokesperson told Seeking Alpha in an email. “We will continue to make decisions and take actions that we believe are in the best interest of the company and our shareholders.”
MarineMax shares rose 27% following news of a potential deal on June 6, though they are now up just 6.6% since before the news. OneWater Marine shares rose 17% following the report, though they are now down 9%.
“The rumored transaction with OneWater may undervalue MarineMax as a whole and would also entail significant regulatory risks and contingencies,” Farkas added.
Island Capital also said MarineMax still owes ICG and its affiliates a deferred earnings payment. ICG and its affiliates continue to have a “material financial interest” in the company, with a deferred earnings payment due in less than a year, listed on the company’s balance sheet at $67.7 million, “which will be resolved favorably as part of this proposal,” Farkas wrote.
MarineMax (HZO) did not immediately respond to Seeking Alpha's email request for comment.
