WESTPORT, Conn. - Compass Diversified (NYSE: CODI), an owner of leading middle market businesses, announced today the sale of its air gun division, Crosman Corporation, to Daisy Manufacturing Company. The transaction, which was both agreed upon and completed simultaneously, marks the transfer of Crosman from the portfolio of Compass Diversified's subsidiary, Velocity Outdoor, Inc., to Daisy, a recognized name in the air gun industry.
Crosman is known for over a century as a pioneer in the air gun sector, designing, manufacturing, and marketing products under various brands including Crosman, Benjamin, and Centerpoint Optics. Daisy Manufacturing, now the new owner, also has a history in the air gun market, offering products under brands such as Daisy and Winchester. Daisy is part of the portfolio of BRS & Co.
The proceeds from the sale will be directed towards reducing debt and for general corporate purposes. Compass Diversified's CEO, Elias Sabo, expressed gratitude for Crosman's contributions since its acquisition in 2006 and confidence in Crosman's future success under Daisy's ownership. Tom McGann, Chairman of Velocity Outdoor, thanked the Crosman team for their dedication and wished them continued success.
Robert W. Baird & Co served as the exclusive financial advisor, and Gibson, Dunn & Crutcher LLP provided legal counsel to Compass Diversified for the transaction. Daisy was advised by Kirkland & Ellis LLP.
Compass Diversified, since its IPO in 2006, has focused on owning and managing a diverse portfolio of middle-market businesses across various sectors, maintaining controlling interests in its subsidiaries to drive long-term value creation. The company is known for providing both debt and equity capital to its subsidiaries, fostering financial and operating flexibility.
InvestingPro Insights
As Compass Diversified (NYSE: CODI) streamlines its portfolio with the recent divestiture of Crosman Corporation, investors are closely monitoring the company's financial health and stock performance. According to the latest InvestingPro data, Compass Diversified boasts a market capitalization of $1.66 billion, reflecting its substantial presence in the middle market business sector. Furthermore, the company's gross profit margin stands strong at 43.39% for the last twelve months as of Q4 2023, indicating robust profitability in its operations. Additionally, the company has experienced a notable six-month price total return of 34.17%, showcasing investor confidence and a positive market outlook.
Complementing these metrics are key InvestingPro Tips that could guide potential investment decisions. Notably, Compass Diversified has maintained dividend payments for an impressive 19 consecutive years, which could be a reassuring factor for income-focused investors. Moreover, while the company was not profitable over the last twelve months, analysts are predicting that Compass Diversified will return to profitability this year. This forward-looking optimism is a critical aspect for those considering the future growth potential of the company.
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