OneWater Marine bids $2.5b for MarineMax, say reports

OneWater Marine.

OneWater Marine bids to acquire MarineMax.

OneWater Marine has offered to acquire its top competitor MarineMax in an all-cash deal valued at $2.5bn including debt, according to reports.

Already a well-established company with 95 dealerships, 10 distribution warehouses, and online marketplaces across 18 states, OneWater would gain significant scale with the addition of MarineMax’s extensive network, creating a dominant player in the industry.

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OneWater would not comment on speculation but in a statement underlined it is a “highly disciplined and seasoned acquiror within the fragmented boating industry”.

“Since 2014, we have successfully executed more than 30 acquisitions that have contributed to increased shareholder value,” it said. “This strong track record is anchored by our ability to meaningfully expand EBITDA of acquired companies through expeditious synergy realization.”

MarineMax, which claims to be the world’s largest recreational boat and yacht retailer, boasts more than 130 locations worldwide, including 83 dealerships.

Both companies have been battling headwinds for the past three quarters. Competition in the marine market has been fierce. MarineMax’s Q2 profits took a nosedive, plummeting a staggering 94% year-over-year to $1m. CEO Brett McGill blames it on a “challenging market environment.” To make matters worse, its revenue flatlined at $583m for the quarter.

OneWater has been worse off. The company has reported net losses for three quarters straight, with the latest one hitting $4m. To make matters worse, its revenue also decreased 7%YoY to $488m. CEO Austin Singleton says the losses are expected in the backdrop of “competitive selling environment” and correction in boat pricing.

However, in the statement addressing the speculation, OneWater said it has a “strong balance sheet” and would “prioritize judicious capital allocation” and “maintain appropriate levels of leverage while evaluating strategic opportunities”.

According to the report by Bloomberg, the two companies are likely to announce a deal in the coming months.

The potential merger of these two industry giants is expected to lead to cost savings through consolidation. Analysts also speculate that the combined entity could offer more competitive pricing to consumers.