Daniel Gilbert, who holds nearly 15% of Rawlings stock, said he has become comfortable with K2 CEO Dick Heckmann’s vision for Rawlings and will support KTOs purchase of the venerable sporting goods brand.
Gilbert had made a number of bids of his own over the last year, finally offering $8.50 a share in mid-December. Mr. Gilbert felt the company was under-capitalized. He originally opposed the KTO takeover, citing K2’s “highly leveraged balance sheet, non-existent revenue growth, and thin margins.”
The merger, approved by KTO and RAWL boards in January, would see K2 pay about $84 million in stock for Rawlings and assume about $34 million in debt, topping Gilbert’s cash bid of $69 million.
Gilbert declined an offer of a place on K2’s board.
The deal will go before shareholders of both companies in March.
