Topgolf Callaway Brands Corp. has signed a definitive agreement to sell a 60 percent stake in its Topgolf and Toptracer business to Los Angeles private-equity funds managed by Leonard Green & Partners.
The transaction values the business at approximately $1.1 billion and is expected to generate around $770 million in net proceeds (subject to purchase price adjustments). The deal is expected to close in the first quarter of 2026 and is not subject to any financing conditions. Leonard Green & Partners has obtained debt and equity commitments for the transaction.
Strategic focus
“This transaction is highly attractive in that it provides the Company with both significant proceeds and substantial upside in the continued growth of Topgolf,” said Chip Brewer, President and CEO of Topgolf Callaway Brands. “Importantly, this transaction supports our strategy of focusing on our leading Golf Equipment & Active Lifestyle platform.”
Following the transaction, Topgolf Callaway Brands Corp.’s brand portfolio will consist of Callaway, Odyssey, TravisMathew and Ogio. These businesses generated about $2 billion in revenues over the 12 months through the third quarter of 2025.
Market context
The sale comes after a decline of approximately 56 percent in Topgolf Callaway Brands shares (MODG) over the past year – from around $14.25 in November 2024 to $10.11. The S&P 500 climbed 15.6 percent over the same period. Despite persistent profitability challenges – with operating margins of -31.0 percent and return on invested capital of -20.2 percent – the company has shifted to positive operating cash flow and now boasts a free-cash-flow yield of 51.5 percent, driven largely by this divestiture and cost controls. The stock trades at an enterprise value-to-sales ratio of 0.89×, well below its five-year average of 1.24×, and the company holds a net cash position with net debt/EBITDA of -1.92×.
Company name change
Upon closing, Topgolf Callaway Brands Corp. plans to change its name to Callaway Golf Company and update its ticker symbol to CALY. The company’s common stock will continue to be publicly traded on the New York Stock Exchange.
Advisors
Goldman Sachs & Co. and Centerview Partners are serving as financial advisors to Topgolf Callaway Brands, with Latham & Watkins serving as legal counsel. Moelis & Company is acting as financial advisor to Leonard Green & Partners, with Ropes & Gray serving as corporate legal counsel and Sidley Austin as financing counsel.
