Why the proposed Rather Outdoors acquisition of Zebco Brands is the biggest industry story for decades

We may be in the midst of a global pandemic, a chaotic political climate in the world’s most powerful country and the most severe economic contraction since World War II. But business goes on.

And business doesn’t get any bigger in the fishing tackle industry than the touted acquisition of Zebco Brands by Rather Outdoors, owner of Lew’s, Strike King, Salmo and a clutch of highly-valued Fox International brands.

The situation right now is that an agreement has been reached between the parties but it has to be ratified by the Vienna-based Federal Competition Authority, subject to the Cartel Act.

The deal, if confirmed, could be the biggest industry story for decades. Bigger even than Pure Fishing’s ill-advised purchase by Newell Rubbermaid (later renamed Newell Brands) in 2016 and its subsequent hasty transfer to Sycamore Partners, the current owner, 35 months later.

This is consolidation at its highest level – and could result (now or later) in the world’s biggest fishing tackle company. Size of course depends on how it is measured – production output, number of brands, sales revenue or simply reputation.

On the number of brands, Rather is certainly going to be right on the shoulder of what is currently the world’s biggest producer of fishing tackle, which numbers 19 brands in its portfolio at the last count. As for the other criteria, we will have to wait and see.

But whichever way you look at it, the melding of Rather’s aforementioned businesses with Zebco, Badlands, Preston Innovations, Korum, Avid Carp and Sonubaits is a formidable proposition.

And that’s before we include one of Europe’s oldest tackle suppliers, Zebco Europe, and its Quantum, Radical, Browning and Black Cat brands.

Zebco Brands owner, W.C. Bradley, reunited the two companies when it bought Zebco Europe in 2011. And although the limited information contained in yesterday’s news doesn’t disclose how or if the European business is included in the deal, it would seem highly likely.

With Rather having aspirations for serious growth in Europe, the addition of established and, in some cases, revered names such as Preston, Korum, Fox and Salmo presents a powerful offering. The match, specimen and bait markets, all new to Rather, would be instantly in reach. Anglers in just about every conceivable market will find what they need in a Rather brand.

Yesterday’s news is also another reminder of the continuing impact being made on the tackle industry by cash-laden private equity firms. Rather Outdoors, previously known as Lew’s Tackle, has not stopped flexing its muscles since being taken over by Peak Rock Capital and then BDT Capital.

The very purpose of private investment companies is to buy businesses, often family or founder-led (Fox, Lew’s, Strike King), fund growth, exploit economies of scale, accelerate revenues and then sell on for a substantial profit. That is what they do.

So what does all this mean to the industry? That Rather and Zebco will continue to turn out quality products is not in doubt. Those people who are deemed valuable will keep their jobs. Those who are not, or are duplicating a service already provided, will not. It’s no surprise that one senior manager approached by Angling International for further information was referred to W.C. Bradley’s chief human resources officer.

It’s also not unusual for weaker or unprofitable brands to go by the wayside in the wake of these kind of deals and that could happen in this instance. Also of course, consumers loyal to the acquired brands will be concerned that their favourite gear is about to be changed (watch social media when the story breaks in full!).

Who knows the full extent of what will happen? But for anyone seeking reassurance, it’s worth noting that while Newell never saw Pure Fishing as part of a long-term plan, there seems little doubt that BDT is more serious about the industry. It said from day one that it would add to it fishing assets – and it has done just that.