Sale of TaylorMade Golf by its private equity owner may begin soon according to reports
Sale of TaylorMade Golf by its private equity owner may begin soon according to reports Reports from South Korea state that TaylorMade's parent company may ask for $3.5 billion for the brand, but one investor wants to wait.
Is TaylorMade Golf about to hit the block?
Talk that the Carlsbad, Calif.-based equipment maker could be sold has accelerated, according to a report on May 9 in the Chosun Daily, a Korean publication.
Earlier this year, Centroid Investment Partners, a South Korean private equity firm that purchased TaylorMade Golf in 2021, was reported to be considering selling the equipment maker. The latest report claims that TaylorMade may begin the sale of its management rights, 'as early as next month, with the company aiming for a valuation of around $3.5 billion.'
The $3.5 billion targeted sales price is believed to be based on a valuation benchmarked against Acushnet Holdings, the parent of Titleist.
According to investment banking sources, sale advisors JP Morgan and Jefferies plan to send teaser letters to potential buyers in June or July. Strategic investors from China and the Middle East are expected to be key targets.
There's one potential holdup: F&F, the South Korean fashion group that joined as a strategic investor at the time of Centroid's 2021 acquisition of TaylorMade, reportedly opposes the sale. 'Through legal counsel Yulchon LLC, F&F has submitted formal notices stating it will exercise its right to approve major corporate decisions should the deal proceed,' the Chosun Daily reported.
F&F also argues that the scope of its right of first refusal remains ambiguous. The company holds both the right to approve key decisions and the right of first refusal on TaylorMade, and has consistently opposed a sale—pushing instead for continued growth and a future IPO.
Centroid maintains that the planned sale does not fall under F&F's approval rights and charges that the terms of the right of first refusal are clearly defined. If a third-party buyer presents an offer, F&F would have 14 days to match or exceed that price to take control. F&F invested $392 million into the fund when TaylorMade was valued at just $1.5 billion.
In January, Jeong Jin-hyeok, the CEO of Centroid Investment, told Nikkei Asia that he is, 'satisfied with TaylorMade's golf ball business as it has grown more than 20 percent on average per year since Centroid's acquisition in 2021, while noting that he will be monitoring how its clothing operations perform through 2025.'
That would be a reference to the apparel business, which the company backed last year, with Tiger Woods and known as Sun Day Red.
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