Weber’s stock shot up earlier today based on a report from Street Insider that a private equity firm has approached them about a takeover. In response to the bid, Weber is said to have hired investment bank Centerview Partners to review its options.
Update 10/24: The rumors are confirmed about a takeover offer.
Another report on Crain’s Chicago Business says that Weber is exploring debt financing from one on it’s largest shareholders, BDT Capital Partners. Weber is said to have formed a special committee to evaluate it’s capital needs and is working with Centerview Partners on the debt financing as well.
It’s unclear if the rumor from Street Insider is related to the debt financing rather than a takeover.
Weber has seen it’s stock price plummet since it IPO’d a little over a year ago. Since then, they’ve let go of their CEO and turned-over their entire executive management team except their CFO. The most recent management change was their General Counsel earlier this month.
Like the whole outdoor cooking industry, sales have slowed since the pandemic. This has left companies like Weber with excess inventory on declining sales. That’s a recipe for needing cash because their inventory isn’t converting. The debt financing could help Weber get through the winter months, because they didn’t sell enough during the summer. We’ll likely have to wait until next month for an update on the alleged takeover bid and debt financing when Weber gives their quarterly earnings update.