Riddell, the U.S. company that makes most of the helmets worn by NFL players, is looking for a buyer, according to Reuters. The company, which is owned by private equity firm Fenway Partners, has hired investment banks UBS Group and Robert W. Baird & Co to explore market interest in a deal that could value it at around $800 million, people familiar with the matter said.
Riddell’s long history and innovation in football equipment
Riddell was founded in 1929 by John T. Riddell, who invented gear such as removable football cleats and plastic helmet shells. The company has been at the forefront of football equipment innovation, developing features such as inflatable liners, face masks, and wireless communication systems. Riddell also introduced the first football helmet with a built-in sensor to measure the impact of hits, called the InSite Impact Response System, in 2014.
Riddell is the official helmet partner of the NFL, and has a seven-year extension of the contract through the 2030 season. The company also makes football helmets and shoulder pads for college, high school, and youth football programs. According to the company, about 76% of NFL players wear Riddell-branded helmets, including stars such as Patrick Mahomes, Aaron Rodgers, and Tom Brady.
Riddell’s potential valuation and challenges
Sources told Reuters that Riddell generates around $85 million of annual earnings before interest, taxes, depreciation and amortization (EBITDA). Based on a similar multiple of 10.5 times EBITDA that another sports equipment company, Marucci Sports, received in a recent acquisition by Fox Factory Holding Corp, Riddell could be worth around $800 million.
However, some of the sources also said that negative press coverage of the concussions and brain injuries that NFL players suffer could weigh on the deal value. Riddell has faced several lawsuits from former players who claimed that the company failed to warn them of the risks of head trauma or to protect them from it. Riddell has denied any wrongdoing and said that its helmets are designed to reduce the risk of injury.
Riddell’s possible suitors and competitors
Riddell has not disclosed any potential buyers, but some of the sources said that other buyout firms have shown interest in the company. Riddell could also attract strategic buyers who are looking to expand their presence in the sports equipment market, such as Nike, Adidas, or Under Armour.
Riddell’s main competitor in the football helmet market is Schutt Sports, which claims to have about 20% of the NFL market share. Schutt is also owned by a private equity firm, Platinum Equity. Other players in the market include Xenith, Vicis, and SG Helmets.
