A dissident shareholder of Rawlings Sporting Goods Co. has cleared the basepaths for K2 Inc.'s takeover of the venerable baseball equipment maker.
Daniel Gilbert, who owns about 15% of Rawlings, said Thursday that he would support the proposed merger with K2, the Los Angeles-based maker of Olin skis, Shakespeare fishing gear and other sporting goods.
Gilbert had objected to the $84-million all-stock transaction when it was announced in December, and made a $69-million cash offer for Fenton, Mo.-based Rawlings.
But talks with K2 Chief Executive Richard Heckmann over the last month as well as K2's improving financial position apparently mollified Gilbert, persuading him to drop his bid for Rawlings.
"I have become comfortable with Mr. Heckmann's vision for Rawlings and the K2 management team, and I have currently decided to support the proposed merger," Gilbert said in a statement.
Gilbert, who is Rawlings' largest shareholder, said Heckmann offered him a seat on the board of the merged company, but he declined. Gilbert is chairman of Livonia, Mich.-based Quicken Loans Inc.
"We showed him our strategy and our balance sheet and that convinced him that our company was a lot stronger than he originally thought," Heckmann said.
Best known for its close association with professional baseball -- most major league players use Rawlings fielding gloves -- Rawlings is one of the oldest names in sporting goods. More than 100 years ago the firm developed the first football shoulder pads. Later, it made the first baseball glove with a pocket between the thumb and fingers.
Gilbert's support comes about a month before shareholders of both companies are set to vote on the deal.
On Tuesday, K2 said it earned $521,000, or 3 cents a share, in the quarter ended Dec. 31. That reversed a loss of $2.5 million, or 14 cents, a year earlier. Sales rose less than 1% to $127.7 million. K2 also said it had slashed its debt by about 40%.
K2 shares rose 1 cent to $9.03 on the New York Stock Exchange on Thursday. Rawlings shares fell a penny to $8.78 on Nasdaq.