Bringing Arctic Cat under the umbrella of an industrial giant like Textron might be just the deep-pocketed boost the struggling underdog needs to push into the motorsport big leagues — or at least ensure survival, says one longtime observer of the Minneapolis-based snowmobile and ATV maker. This is according to industry analyst Robert W. Baird, equity analyst Craig Kennison, as he stated in a Minneapolis Star Tribune interview.
Here are 10 reasons he gave as to why Arctic Cat was sold to Textron:
- Larger competitors like Polaris Industries, Bombardier and Honda (ATV) are growing and dominating the snowmobile, ATV and motorsports markets.
- A general softening of the ATV market over the last year or so.
- Too much unsold inventory – Arctic Cat had troubles clearing dealer inventories.
- Trouble supporting new product research-and-development
- Facing an increasingly competitive sales and promotional environment
- Challenges in upgrading its dealer network
- Not having a big enough cost structure to absorb aggressive price discounting
- Pressured by weak discretionary income in key rural markets
- Did not have the resources necessary to deliver a suitable return on investment as a stand-alone enterprise
- The company was struggling in a soft power-sports economy
On Wednesday, January 25, 2017, Arctic Cat announced it was been acquired by Textron Industries for $247 million in an all-cash deal. Textron Inc, is a Rhode Island-based conglomerate whose products include Bell helicopters, Cessna airplanes, Jacobsen Lawn Mowers and E-Z Go golf carts.
Read the entire Star-Tribune article here....