Monomoy’s $104.50-a-share offer does not top LCI’s deal with Patrick
Key Facts
LCI Industries unanimously determined that the revised, non-binding cash offer of $104.50 per share from Monomoy Capital Partners does not constitute a superior proposal to its existing merger agreement with Patrick Industries and is unlikely to lead to a superior proposal, according to a company filing with the U.S. Securities and Exchange Commission on November 10. The decision places the new offer under the board’s review pursuant to the merger agreement, while LCI continues to favor the deal with Patrick. The company said Monomoy’s offer “undervalues LCI, both on a standalone basis and compared with the value-creation opportunity from the pending merger with Patrick.” The revised offer arrived on November 6, after an initial offer of $101 per share was announced in October; the board had also determined that the first offer did not constitute a superior proposal. The board’s decision therefore does not mean a completed acquisition was rejected; it concluded that the revised offer does not top the deal the company has already agreed to.
The board’s assessment, according to the filing, was based on its view of LCI’s value independent of the deal and the gains it expects from the merger with Patrick. The company said Monomoy’s offer values it at about 7.2 times forward EBITDA for the next twelve months. That multiple is about 1.3 times below LCI’s average trading multiple over three years, according to the company’s calculation. The comparison sets the cash takeover offer against a historical benchmark for the stock’s trading value, while LCI sees the Patrick deal as offering a greater opportunity to create value. The filing did not give a guaranteed value for the standalone company; it presented the board’s position on the offer and its comparison with the trading average and the merger opportunities.
LCI provided the market indicators underpinning its assessment in the filing: its shares traded above $104.50 during the session on November 5, after the third-quarter results were announced and before Monomoy submitted its revised offer. That means the stock exceeded the cash offer level in that session before the offer arrived, according to the company. On November 9, LCII shares closed at $101.11, according to EL7 data. That close put the stock below the $104.50 offer value, but came after the November 5 session in which the stock traded above that level. The sequence of prices indicates that comparing the offer with a single day’s close differs from comparing its value with the stock’s level during an earlier session.
The competing offers come as LCI faces weakness in the recreational vehicle market, which has weighed on its quarterly results. Consolidated net sales were $992.5 million in the third quarter of 2026, compared with $1,036.5 million in the corresponding quarter of 2025, according to the company’s results filed with the U.S. Securities and Exchange Commission. LCI attributed the main driver of the decline to lower wholesale recreational vehicle shipments in North America. Interim CEO Johnny Sirpilla said margin expansion and 6% growth in product content per unit contributed to performance despite weakness in the outdoor recreation market. He said these factors put the company in a position to achieve its revised full-year outlook, according to the statement.
In its long-term view of the recreational vehicle market, LCI estimated average expected wholesale shipments of about 308,000 units. The company said that level is 11% to 29% below historical averages calculated over periods of 10 to 30 years. The assumption puts the expected current market below the range of those historical comparisons, while the decline in North American shipments is among the factors that pressured quarterly sales. The company presents the shipment outlook and its historical context among its arguments for LCI’s standalone value. By contrast, it said the merger with Patrick offers an opportunity to create value, alongside expected net recurring cost savings of about $150 million within three years of completing the deal.
The Patrick deal stems from a definitive agreement LCI signed on June 30, 2026, and is an all-stock merger, according to the company’s third-quarter results. Shareholders are scheduled to hold a special meeting to vote on the deal on November 18. LCI said ISS and Glass Lewis recommended that shareholders vote in favor of the deal at that meeting. LCI and Patrick still expect to complete the merger in the first half of 2027, subject to shareholder and regulatory approvals and the satisfaction of customary closing conditions. The November 18 vote is the next milestone in the deal that the board is using as a basis for its assessment of Monomoy’s revised offer.