Fila Korea and Mirae Asset are set to pay $1.23 billion for the Titleist and FootJoy golf brands after winning an auction against worldwide competition.
The Titleist and FootJoy brands are owned by Acushnet, which is based in Massachusetts and is a subsidiary of Illinois-based Fortune Brands, which also owns the Jim Beam alcoholic beverage business. It put Acushnet on the block last year as part of its plan to become a pure-play liquor company named Beam.
The auction was keenly contested, according to a source close to the deal, by a field of bidders that included multi-brand sports companies such as Nike and Adidas and golf equipment companies such as Callaway, as well as other private-equity firms, including Blackstone.
Titleist is the global market leader in golf balls and well established in high-performance golf clubs. Under the FootJoy brand, Acushnet sells shoes, gloves and outerwear. Across all products, Acushnet had sales of $1.2 billion in 2010 with almost half of that coming from markets outside the US.
The buyer consortium is led by Fila Korea and the private equity arm of Mirae Asset, which launched Korea’s first local private equity fund in 2004. Fila Korea owns the Fila sports brand worldwide, which was established by the Fila brothers in Italy in 1911. The brand was bought by its current owners in a management buyout. Fila Korea is led by Yoon-Soo (Gene) Yoon, who is chairman and chief executive officer, and also led the MBO in 2005. The National Pension Service of Korea, the fourth-biggest pension fund in the world, and Korea Development Bank, Korea’s largest government-owned bank, are also part of the buyer consortium.
“The acquisition of Acushnet transforms our platform with a stable of premiere world class brands,” said Yoon in a written statement. “With our extensive knowledge and reach in Asia, we believe that the Acushnet brands have incredible new opportunity for growth in the emerging markets in Asia.”
Analysts said from the start that an Asian buyer would probably pay top dollar for Acushnet because growth potential in Asia is high. Golf is one of the fastest-growing and most popular sports in the region, and particularly in Korea.
Sell-side advisers to Fortune Brands were Morgan Stanley and Centerview Partners with legal advice from Chadbourne & Parke. Fila Korea and Mirae were advised by Nomura and Korea Development Bank with legal advice from McDermott, Will & Emery.