New Investor in Wilderness Holds Edge : Its 31.6% Stake a Plus for Control of Outdoor-Gear Firm
Whatever happens at a meeting today to decide the outcome of a proxy fight for control of Chatsworth-based Wilderness Experience, one thing seems sure: A Los Angeles partnership headed by a Merrill Lynch investment banker will be in the driver’s seat.
The partnership, MarBen Associates, won’t discuss its plans. But it bought a 31.6% stake in the outdoor-gear company on Aug. 21 for $650,000, giving it what appear to be enough votes to decide the proxy fight.
What’s more, MarBen also obtained a warrant giving it the right to buy enough additional shares at 35 cents each--well below the market price--to amass 53% of Wilderness Experience’s stock, giving MarBen clear-cut control.
Outcome Called Unclear
Both sides in the proxy fight, which should be resolved at a special shareholder meeting this morning at company headquarters, claim not to know how MarBen will vote. But Wilderness Chairman Greg Thomsen said MarBen “would not invest money with current management if their intention was to throw out the current management.”
The proxy fight has pitted brother against brother. Greg Thomsen, who is chairman and president of Wilderness, is being challenged by the self-styled Committee to Save Wilderness Experience, which includes his brother Jim Thomsen, a former company president. Greg has a 21.9% stake; Jim’s is 9.7%.
The Thomsens started the company together 12 years ago, but had a falling out in 1982 over whether it should produce sportswear and do more of its manufacturing overseas. Traditionally, Wilderness Experience manufactured exclusively in the United States, making high-end tents, parkas and other outdoor gear. Greg Thomsen, who advocated sportswear and overseas production, won the dispute and Jim Thomsen left the company.
Investment-Banking Arm
MarBen is an investment group whose general partner is Jeffrey C. Barbakow, a managing director of Merrill Lynch Capital Markets, the investment-banking arm of the giant financial services company.
No other information about MarBen has been disclosed, and Barbakow refused to make any comment.
Greg Thomsen said the company decided to sell newly issued stock to MarBen simply to get additional capital, and that the transaction had nothing to do with the proxy fight.
For the fiscal second quarter ended April 30, Wilderness Experience lost $255,000 on sales of $1.7 million, versus earnings of $26,000 on sales of $1.5 million for the same period a year ago. During the fiscal year that ended Oct. 31, 1984, Wilderness Experience earned just $3,000 on sales of $6.2 million.
Greg Thomsen attributed the sluggish performance to costs associated with launching the company’s sportswear and swimwear business.
