Street Calls of the Week
VALCOURT, Quebec - BRP Inc. (TSX:DOO; NASDAQ:DOOO), currently trading at $68.19 with a market capitalization of approximately $5 billion, announced Monday that Bain Capital Integral Investors II, L.P. has entered into an agreement with BMO Capital Markets for a secondary offering of 1.5 million subordinate voting shares at C$90.71 per share.
The bought deal arrangement will reduce Bain Capital’s stake in the powersports vehicle manufacturer from approximately 16.4% to 14.4% of BRP’s outstanding shares, and decrease its voting power from 27.1% to 24.4%.
According to the press release statement, Bain Capital also plans to distribute up to 1.2 million multiple voting shares to certain affiliates and limited partners following the offering’s completion. These shares will be subject to contractual lock-up or statutory transfer restrictions.
The offering is expected to close around September 12, 2025, subject to customary conditions. BRP will not receive any proceeds from the transaction, as all net proceeds will go directly to Bain Capital.
BRP will file a prospectus supplement to its short form base shelf prospectus dated March 26, 2025, with securities regulatory authorities in Canada and the U.S. Securities and Exchange Commission.
BRP, headquartered in Quebec, Canada, manufactures powersports products including Ski-Doo and Lynx snowmobiles, Sea-Doo watercraft, Can-Am vehicles, and Rotax marine propulsion systems. The company reported annual sales of $7.8 billion as of January 31, 2025, with approximately 16,500 employees globally. Trading at a P/E ratio of 34.5 and offering a dividend yield of 0.95%, InvestingPro analysis suggests the stock is currently trading above its Fair Value. Subscribers can access 13 additional ProTips and comprehensive financial metrics in the Pro Research Report.
In other recent news, BRP Inc. reported its second-quarter 2025 earnings, surpassing both earnings per share (EPS) and revenue forecasts. The company achieved an EPS of $0.92, which was significantly higher than the anticipated $0.4613, marking a notable 99.44% surprise. Additionally, BRP Inc.’s revenue reached $1.9 billion, exceeding expectations by 6.18%. These results reflect the company’s robust financial performance for the quarter. Investors responded positively to the earnings announcement. The strong earnings report highlights BRP Inc.’s ability to exceed market expectations.
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