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MarineMax (NYSE:HZO) rose 4% in after hours trading after Island Capital Group offered to buy a 100% interest in the company’s yachting and marina business.
Island Capital Group, which is run by Andrew L. Farkas, who sold the YRMS business to MarineMax (HZO) in 2022 for $480 million, wants to buy the unit back from the company, according to a statement on Tuesday.
Island Capital is seeking to engage with MarineMax (HZO) immediately and believes a deal could be completed in as little as 60-90 days.
“We propose acquiring the YMRS assets at double-digit EBITDA valuation multiple, while the company currently trades within a 5-6 times multiple range,” Farkas wrote in a letter to MarineMax holders on Tuesday. “Thus, our proposal could unlock significant value for shareholders.”
The Island Capital offer comes after a Bloomberg reported a little more than a month ago that OneWater Marine (ONEW) is in discussions to purchase its larger rival MarineMax (HZO) in an all-cash deal.
MarineMax shares originally surged 27% on news of a potential deal on June 6, though they have now gained only 6.6% since prior to the story. Shares of OneWater Marine rose 17% in wake of the report, though they are now down 9%.
“The rumored transaction with OneWater may undervalue MarineMax as a whole and would also carry significant contingencies and regulatory risk,” Farkas added.
Island Capital also claimed MarineMax still owes ICG and affiliates an earnout payment. ICG and its affiliates continue to hold a “material financial interest” in the company, with an earnout payment due in less than a year, which is carried at $67.7 million on the company’s balance sheet, “which will be favorably resolved as part of this proposal,” Farkas wrote.
MarineMax (HZO) didn’t immediately respond to the Seeking Alpha email request for comment.