[Exclusive] Centroid PE Successfully Acquires Global Golf Equipment Company 'TaylorMade'

[Asia Economy Reporter Lim Jeong-su] Centroid Private Equity (Centroid PE), a domestic emerging management participation private equity firm, is acquiring the global golf equipment company TaylorMade.

According to the investment banking (IB) industry on the 11th, Centroid PE was selected as the preferred bidder for the acquisition of TaylorMade, beating global competitors. This came about a month after being shortlisted as a qualified preliminary acquisition candidate along with companies from the U.S., China, and Europe in the preliminary bidding earlier last month. The acquisition price is reported to be between 1.5 trillion and 2 trillion KRW, but the final purchase price has not been confirmed. An IB industry official stated, "Centroid PE was selected as the preferred bidder last week, and the two parties signed the equity acquisition contract the day before yesterday."

The current largest shareholder of TaylorMade is the U.S. private equity firm KPS Capital Partners. In 2017, they purchased TaylorMade’s shares and management rights from Adidas for $425 million (approximately 500 billion KRW). Last year, KPS selected the global investment bank Morgan Stanley as the sales advisor and has been searching for acquisition candidates domestically and internationally.

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Centroid PE is known to have submitted the highest bid among the shortlisted candidates and was selected as the preferred bidder.

Centroid PE plans to finance about half of the acquisition amount through acquisition financing, with the remainder raised through private equity funds contributed by institutional investors. Before participating in the final bidding, Yuanta Securities, ShinYoung Securities, and Hana Financial Investment were selected as the lead financial institutions for acquisition financing.

Centroid PE plans to enhance corporate value by raising brand awareness domestically in line with the popularization trend of golf in Korea. Their strategy is to follow a trajectory similar to that of Fila Korea and Mirae Asset PE, which saw rapid domestic sales growth after acquiring Acushnet (Titleist).

TaylorMade is considered one of the world’s top three golf equipment companies alongside Acushnet and Callaway. It is famous for being used by many world-class players such as Tiger Woods, Dustin Johnson, and Rory McIlroy. However, its brand awareness and sales volume in Korea lag behind other well-known brands.

Centroid PE plans to maintain the current management team while assembling a new executive team to plan and execute expansion strategies domestically. They will seek synergies among acquired companies by expanding the golf industry value chain in Korea, including additional golf courses.

Earlier this year, Centroid PE acquired 100% of the shares of the premium golf course South Springs Country Club (South Springs CC), which was owned by the BGF Group and the Samsung Group owner family. By acquiring the 18-hole golf course for about 190 billion KRW, they set the highest per-hole acquisition price in the history of domestic golf course transactions (approximately 9.6 billion KRW per hole).

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