/R E P E A T -- BRP to Sell its Telwater Business to Yamaha Motor Australia/

Rhea-AI Summary

BRP Inc. (NASDAQ: DOOO) has announced a definitive agreement to sell Telwater Pty, to Yamaha Motor Australia, a subsidiary of Yamaha Motor Co., This marks BRP's first transaction in divesting its Marine businesses to focus on core Powersports activities.

The sale includes renowned brands Quintrex, Stacer, and Savage. The transaction is expected to complete in the second quarter of BRP's Fiscal 2026, subject to regulatory approvals. National Bank Financial Inc. served as financial advisor, while Stikeman Elliott LLP acted as legal advisor to BRP on the transaction.

Positive

• Strategic focus on core Powersports business through divestment of non-core marine operations
• Sale to established industry player (Yamaha) ensures business continuity

Negative

• Reduction in business diversification through exit from marine segment
• Loss of revenue stream from Telwater operations

Insights

Financial Analyst

BRP's sale of Telwater to Yamaha Motor Australia marks the first concrete step in their previously announced strategic realignment to exit Marine businesses and concentrate on core Powersports activities. This transaction involving the Quintrex, Stacer, and Savage boat brands represents a significant portfolio reshaping for BRP.

The lack of disclosed financial terms makes it impossible to assess the immediate value impact, which is a critical missing element for investors. Without knowing the sale price, we can't determine if BRP is capturing appropriate value or how this might affect the company's financial position.

Strategically, this move aligns with management's stated intention to streamline operations and focus capital allocation on their core competencies. Powersports typically generates stronger margins and growth prospects for BRP compared to Marine segments, suggesting potential long-term benefits from this increased focus.

The buyer, Yamaha Motor Australia, already has an established 40+ year presence in the regional boat industry, positioning them to potentially extract more value from these assets than BRP could as a non-core business. The expected closing in Q2 of fiscal 2026 indicates regulatory processes are still ahead.

This transaction is just the opening move in what appears to be a multi-step divestiture of BRP's entire Marine segment. Investors should watch closely for subsequent Marine business sales and, more importantly, how BRP redeploys the capital from these transactions to strengthen its Powersports positioning.

VALCOURT, QC and BRISBANE, Australia, April 1, 2025 /PRNewswire/ - BRP Inc. (TSX: DOO) (NASDAQ: DOOO) announces today that it has entered into a definitive agreement to sell 100% of the outstanding shares of Telwater Pty, Ltd. to Yamaha Motor Australia Pty Ltd., a subsidiary of Yamaha Motor Co., Ltd. The acquirer has been established in the region since 1983 and a key player in Australia's boat industry.

This transaction follows BRP's decision to sell its Marine businesses to channel its efforts and investments towards its core Powersports activities, thereby enhancing its position for long-term success.

"We are pleased with today's announcement, our first transaction in the process for the sale of our Marine businesses," said José Boisjoli, President and CEO of BRP. "I would like to sincerely thank all of the talented employees for their contribution and commitment over the years. We know we can count on their professionalism to continue supporting our dealers and customers with dedication through this transition period, until the transaction is completed."

Telwater Pty, Ltd. includes the businesses of renowned brands such as Quintrex, Stacer and Savage. This transaction is subject to certain customary closing conditions, including regulatory approval, and is expected to be completed in the second quarter of BRP's Fiscal 2026.

National Bank Financial Inc. acted as financial advisor and Stikeman Elliott LLP acted as legal advisor to BRP on the transaction.

CAUTION CONCERNING FORWARD-LOOKING STATEMENTS
Certain information included in this release, including, but not limited to, statements relating to the completion of the sale of Telwater Pty, Ltd., the anticipated benefits associated with the completion of this sale, the receipt of all requisite approvals to complete the acquisition, the closing date of the acquisition and the Company's business and strategic plans, and other statements that are not historical facts, are "forward-looking statements" within the meaning of Canadian and United States securities laws. Forward-looking statements are typically identified by the use of terminology such as "may", "will", "would", "should", "could", "expects", "forecasts", "plans", "intends", "trends", "indications", "anticipates", "believes", "estimates", "outlook", "predicts", "projects", "likely" or "potential" or the negative or other variations of these words or other comparable words or phrases. Forward looking statements, by their very nature, involve inherent risks and uncertainties and are based on several assumptions, both general and specific. BRP cautions that its assumptions may not materialize and that current economic conditions render such assumptions, although reasonable at the time they were made, subject to greater uncertainty. Such forward-looking statements are not guarantees of future performance and involve known and unknown risks, uncertainties and other factors which may cause the actual results or performance of BRP to be materially different from the outlook or any future results or performance implied by such statements. Further details and descriptions of these and other factors are disclosed under the heading "Risk Factors" of the Corporation's management's discussion and analysis for the fiscal year ended on January 31, 2025.

About BRP
BRP Inc. is a global leader in the world of powersports products, propulsion systems and boats built on over 80 years of ingenuity and intensive consumer focus. Through its portfolio of industry-leading and distinctive brands featuring Ski-Doo and Lynx snowmobiles, Sea-Doo watercraft and pontoons, Can-Am on and off-road vehicles, Alumacraft and Quintrex boats, Manitou pontoons and Rotax marine propulsion systems as well as Rotax engines for karts and recreational aircraft, BRP unlocks exhilarating adventures and provides access to experiences across different playgrounds. The Company completes its lines of products with a dedicated parts, accessories and apparel portfolio to fully optimize the riding experience. Committed to growing responsibly, BRP is developing electric models for its existing product lines. Headquartered in Quebec, Canada, BRP had annual sales of CA$7.8 billion from over 130 countries and employed approximately 16,500 driven, resourceful people as of January 31, 2025.

www.brp.com
@BRPNews

Ski-Doo, Lynx, Sea-Doo, Can-Am, Rotax, Alumacraft, Manitou, Quintrex, and the BRP logo are trademarks of Bombardier Recreational Products Inc. or its affiliates. All other trademarks are the property of their respective owners.

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SOURCE BRP Inc.

FAQ

When will BRP (DOOO) complete the sale of Telwater to Yamaha Motor Australia?

The transaction is expected to complete in Q2 of BRP's Fiscal 2026, pending regulatory approvals.

Which boat brands are included in BRP's Telwater sale to Yamaha?

The sale includes the Quintrex, Stacer, and Savage boat brands.

Why is BRP (DOOO) selling its Telwater business?

BRP is selling its Marine businesses to focus investments on core Powersports activities for long-term success.

Who are the advisors for BRP's Telwater sale transaction?

National Bank Financial Inc. (financial advisor) and Stikeman Elliott LLP (legal advisor).