Titleist may be sold
Acushnet Co., makers of the top rated and best selling Titleist Pro V1 golf balls and FootJoy shoes, could be part of a corporate shedding by parent Fortune Brands (NYSE:FO). Rumors have both Callaway Golf (NYSE:ELY) and Nike (NYSE:NKE) as potential purchasers of Acushnet, the world’s largest golf equipment company.
The equipment business has not been doing well in recent years with insiders citing a shrinking golf base in the U.S. and a collapse of formerly high growth markets in Asia. Acushnet reported third quarter operating income down 43 percent ($5.5 million) for the three months ended Sept. 30 and down from $9.7 million for the third quarter 2009. Sales were $265 million down $13 million quarter over quarter. Compared to last year Acushnet sales were up about 2 percent to over $1 billion had operating income of $115 for the nine months, an 85 percent increase over 2009.
So at least Acushnet is making a profit. Callaway Golf, contrasting to Acushnet’s core ball business (over 50 percent market share) has not seen their basic business of metal woods expand in the face of dominant competition such as adidas’ (PINK:ADDDF) TaylorMade Golf. Callaway had more than a 10 percent loss in the most recent quarter and lost 1.6 percent in 2009 so unless they find affordable financing they probably cannot afford a deal for Acushnet.
Nike’s golf business is built around Tiger Woods and particularly in the past year has not done well as they would like especially with the previously top ranked fan-favorite (see next item) golfer as spokesman. Nike most likely has the money and it would be a way to pair the competitive environment at the top of the golf equipment market from four players to three.
Tiger shut out
Tiger Woods, golf’s fallen idol, according to a story on Bloomberg.com still retains his attractiveness to tournament goers, at least in Australia. Playing to a fourth place finish in this past weekend’s Australian Masters, Woods the defending champion still drew large crowds whether watching him warm up or his amazing 6-under par finish in the last round.
It was almost one year ago; two weeks after Woods triumph at the 2009 Australian Masters and last tournament victory, his troubles came to light with the early morning car crash at the end of his suburban Orlando driveway. The victory last year was not without controversy though, since he received a reported $3 million appearance fee which was justified as having helped generate $34 million for the local Victorian economy. Total tournament purse was $1.5 million and Woods received the same appearance fee this year.
With this loss Woods also missed his last chance to win a sanctioned event on one of the world professional tours in 2010.
The Great White Shark & Lorena vs. The Golden Bear & Annika
With the 2016 Olympics being held in South America and for the first time in a century including golf, host city Rio de Janeiro needs a golf course worthy of the competition. Stepping up to win the bid to design the new Olympic course are a couple of interesting couples.
Jack Nicklaus has teamed with Annika Sorenstam while Greg Norman and Lorena Ochoa will co-design if they are chosen. No word if Arnold Pallmer will pair up with someone like Laura Davies or maybe Tom Fazio will look to Natalie Gulbis as a partner.
The siege of Troy
Nobody has ever said professional-level golf was easy as PGA Tour rookie Troy Merritt well knows. Trying to keep his Tour card for 2011 Merritt started the final week of the season at 121 on the money list seemingly a comfortable distance above the magic 125 spot to retain full playing privileges.
Sunday of the Children’s Miracle Network Classic at Walt Disney World Merritt lost ground in the marathon which becomes a sprint at the end of the year, but did manage to finish right on the 125 spot. He also went back home to Arizona with a million dollars from his one hole playoff win of the Kodak Challenge over Rickie Fowler and Aaron Baddeley.
About Ed Travis
Related posts:
- The wages of sin
- The fallout continues
- Titleist ads with Villegas still on TV
- Titleist Aces Callaway
