Anoka-based Vista Outdoor Inc. will pay up to $590 million for popular California-based outdoor recreation brand Fox Racing.

Vista Outdoor, the parent company of 39 separate brands that design, manufacture, and market sporting goods and outdoor products, announced Wednesday it has entered into a definitive agreement to acquire Fox Racing, a performance motocross, mountain bike, and lifestyle gear brand.

The initial price tag sits at $540 million, with the potential for an additional $50 million earnout depending on Fox Racing’s financial performance this year. Vista Outdoor plans to close on the purchase in the second quarter of 2023.

The acquisition is expected to close the same year Vista Outdoor plans to split into two separate publicly traded companies. One company will focus on outdoor recreation, the other on ammunition. Vista anticipates the separation to wrap up in 2023. The change is subject to final approval by Vista Outdoor’s board of directors, along with other regulatory approvals. The ammunition company will remain headquartered in Anoka, while the outdoor products group will be headquartered in Bozeman, Montana.

This means the acquisition of Fox Racing would add the brand to the Vista Outdoor’s Outdoor Products segment, which also includes brands like CamelBak, Stone Glacier, and QuietKat. As an independent company, Vista Outdoor’s Sporting Products will focus on ammunition categories through brands including Federal, Remington, CCI, Speer, Estate Cartridge, and HEVI-Shot.

The purchase of Fox Racing will add to Vista Outdoor’s existing portfolio of outdoor brands, said Vista Outdoor CEO Chris Metz in a news release. After Vista Outdoor separates into two companies, Metz will be appointed CEO of Outdoor Products.

“The Fox Racing acquisition meets all of our financial and strategic acquisition criteria, even before taking into account potential benefits from combining Fox Racing with our existing business,” Metz said in the news release.

CEO of Fox Racing, Jeffrey Mcguane, along with the rest of the brand’s leadership team, will continue in their roles after the acquisition closes.

According to the company’s description, Vista Outdoor serves a broad range of consumers around the globe including “outdoor enthusiasts, golfers, cyclists, backyard grillers, campers, hunters, recreational shooters, athletes, as well as law enforcement and military professionals.”

Vista Outdoor was spun off from Alliant Techsystems Inc. in 2014. Alliant Tech is an aerospace and defense company that was based in Minnesota until 2011. It’s now headquartered in Arlington, Virginia.

In 2020, Vista Outdoor purchased part of the ammunition business of the bankrupt Alabama-based Remington Outdoor Company Inc. The purchase came a year after Vista Outdoor sold its own firearms brand for $170 million as part of its broader “transformation plan.”