ONE of the game’s most recognisable brands is about to undergo a major shakeup as Acushnet Holdings Corporation, makers of Titleist and FootJoy equipment, is set to become a publicly traded company.
The company, which was bought by Korean based sports shoe giant FILA in partnership with a private equity firm in 2011 for $1.23 billion, is expected to raise approximately $435 million with an Initial Public Offering this week.
Reports say 19.3 million shares will be offered at between $21 and $24 each.
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The move was first flagged in June this year and while there is likely to be little impact on consumers it is a reflection on the state of the golf industry.
While other major players are in the process of downsizing or exiting the golf business altogether, the IPO by Acushnet is being seen by some analysts as a bold move.
Nike, sponsors of both Rory McIlroy and Tiger Woods, announced recently they will no longer make clubs and balls while Adidas is looking for buyers for its TaylorMade, Adams and Ashworth brands.
Adding to the concern is a slowdown in the number of Initial Public Offerings across all industries in 2016.
However, one analyst told the Boston Globe that working in Acushnet’s favour is the strength of its brands in the golf marketplace.
“Investors right now are very cautious about overpaying,” Kathleen Smith, manager of IPO-focused exchange funds for Renaissance Capital, told the newspaper.
“That makes [IPOs] hard for companies that don’t want to admit they’re not worth as much as they think they are on the private market.
“The (golf) industry is not that robust, so you need to have a strong relationship with diehard golfers.
“Acushnet has good brands, and that’s important.”
Also encouraging has been the recent performance of one of Titleist’s main competitors, Callaway Golf.
The game’s only other publicly listed manufacturer has seen a spike in value over the past 12 months and its current share price is double what it was five years ago.
Acushnet is making no public comments on the upcoming offering because of a legally mandated ‘quiet period’ ahead of Friday’s launch.
Titleist has been one of the game’s most popular brands for decades with its premium golf ball range, the ProV1 and ProV1x, the most used on the world’s professional tours.
Among the company’s brand ambassadors are 2013 US Masters winner Adam Scott, 2016 PGA champion Jimmy Walker, reigning Australian Open champion Matt Jones and 2006 US Open winner Geoff Ogilvy.
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