MLB buys Rawlings from Newell: Who is it going to blame for juiced baseballs?

Major League Baseball is stepping up to the plate in the sporting goods world, reaching a near-$400 million agreement to buy — with an investment partner — the Rawlings brand of equipment from Hoboken-based Newell Brands Inc.

The deal, which includes the St. Louis-based Rawlings Sporting Goods Co. Inc. and its Rawlings, Miken and Worth brands, continues a series of divestitures made by Newell as it refocuses on core brands under its Accelerated Transformation Plan.

“We are pleased with the agreement to sell Rawlings at an attractive multiple,” Newell CEO and President Michael Polk said in a prepared statement. “Rawlings is an iconic brand, and Seidler Equity Partners, in partnership with Major League Baseball, will identify new opportunities for this brand and for the company’s employees.

“This transaction is a pivotal step in our company’s transformation to become a more focused, forward-facing consumer goods company with tremendous opportunities.”

MLB and a private investment fund managed by California-based Seidler are paying approximately $395 million, subject to customary adjustments, Newell said in a news release. The company expects after-tax proceeds of about $340 million, which it will use on deleveraging and stock repurchasing.

Rawlings had net sales of about $330 million in 2017.

“MLB is excited to take an ownership position in one of the most iconic brands in sports and further build on the Rawlings legacy, which dates back to 1887,” Chris Marinak, MLB’s executive vice president for strategy, technology & innovation, said in a statement. “We are particularly interested in providing even more input and direction on the production of the official ball of Major League Baseball, one of the most important on-field products to the play of our great game.”

The deal is expected to close in approximately 30 to 45 days, pending customary approvals and conditions.

Morgan Stanley acted as Newell’s financial adviser, while Bank of America Merrill Lynch acted as Seidler’s financial adviser.

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