Fortune Brands has agreed to sell The Acushnet Company, the big golf company that owns the Titleist, FootJoy, Pinnacle and Scotty Cameron brands, to a group of Korean interests for $1.23 billion in cash. That's roughly equivalent to last year's sales of $1.24 billion at Acushnet, which generated operating income of $80.2 million and cash flow of about $100 million.
Many other companies were interested in Acushnet, possibly including Adidas and Callaway. Fortune Brands will realize net proceeds of around $1.1 billion from the sale, which should close this summer subject to regulatory approval and a few other closing conditions.
The majority of Acushnet's equity will be held by Mirae Asset Private Equity, which is described as Korea's largest private equity company. The country's largest government-owned bank, Korea Development Bank, will provide the debt for the deal. Other new shareholders are Fila Korea and the National Pension Service of Korea, which is the fourth-largest pension fund in the world. Nomura Securities has also reportedly pitched in.
Fila Korea is expected to help Acushnet to make a bigger dent In various promising Asian golf markets. The shareholders have pledged to raise the presence of its brands in China, too, although Fila Korea is only a minority shareholder now in a Chinese joint venture for Fila and the brand is licensed in India.
Acushnet, which already generates 45 percent of its turnover outside the U.S. market, will continue to be operated as a separate company under its existing senior management, led by Wally Uihlein. However, Fila Korea is expected to provide regional expertise in retail and distribution to stimulate further growth for Acushnet in Asia.
