The FTC Has Some Questions About The Bass Pro Shops-Cabela’s Merger

Earlier this year, Bass Pro Shops offered to buy up one of its biggest competitors, Cabela’s, for $5.5 billion. The Federal Trade Commission is reviewing the deal now, and is raising concerns that this might be too much consolidation in the hunting and fishing market.

According to the Wall Street Journal, a combined Bass/Cabela’s would control about 20% of the U.S. sporting goods market, and even more of the more niche industry catering to outdoorsy types. In their stores, catalogs, and websites, these two retailers sell gear you’re not likely to find in your local Dick’s or Walmart.

We know about the feds’ request for more information because the smaller partner in this merger, Cabela’s, is a publicly traded company and is required to report such things to the Securities and Exchange Commission so its investors and the public know. Does this necessarily mean that the FTC is going to object to the merger? Nope.

“The issuance of such a ‘second request’ does not indicate that the FTC has concluded that the transaction raises competition concerns,” notes the document that Cabela’s filed with regulators. “The ‘second request’ reflects a determination by the FTC that it requires additional information to assess the proposed transaction.” Maybe the FTC officials assigned to the case aren’t big hunters.

Part of this deal was for Cabela’s to sell its credit card business to Capital One, and the retailer shared in the same filing that the credit card sale would not go through until October 2017 at the earliest. Both retailers had anticipated that the merger could be completed in the first half of the year: that might have to wait until next fall if Capital One is involved.

This year, the FTC shot down another retail mega-merger, that of Staples and Office Depot, though the government’s concerns were on behalf of the companies’ corporate customers, not retail shoppers who can buy their printer cartridges and resume paper from Walmart or Amazon.