Polaris Industries is moving into the boating market with the acquisition of Boat Holdings, a company Polaris CEO and Chairman Scott Wine referred to as a “great business.”
“They’ve managed their capital so well that even in a downturn this thing returns very strong financials for us,” Wine told CNBC on “Power Lunch” on Wednesday.
Boat Holdings, the largest manufacturer of pontoon boats in the U.S., generated approximately $560 million in sales last year.
Polaris Industries — a Roseau, Minnesota-based manufacturer of snowmobiles, off-road vehicles and motorcycles with a market cap of about $7 billion — agreed to acquire Boat Holdings in an $805 million all-cash deal. The deal is expected to close in the third quarter of 2018.
Wine said one of the things that attracted Polaris to Boat Holdings was that the company doesn’t “perform quite as cyclical as the boat or RV industry.”
“Boat Holdings expands Polaris’ footprint in the recreational outdoors market, commanding more of consumers’ discretionary spending,” Wine said in a statement.
Strong consumer sentiment, increased traffic in dealerships and tax cuts that benefited consumers are all signs of future growth for the company, Wine told CNBC.
Shares of Polaris Industries declined Wednesday after the announcement, but are up more than 30 percent year to date.