American Golf sold to US private equity firm
WARRINGTON-based golf retailer American Golf Discount Centre has been sold by private equity parent LDC to Sun Capital Partners for an undisclosed sum.
LDC bought American Golf for £40m in 2004, although it was reported to be looking for an £80m price tag on disposal. The firm now operates from 88 stores across the UK and Northern Ireland and in the year to January 31 it grew sales by 20% to £86.6m.
Like-for-like sales for the year to next January are said to have continued growth and the firm is said to have increased profits by around 250% since 2010, when the business acquired the onlinegolf.co.uk brand and began to push its web presence.
LDC pumped in a further £5m in the business in 2010 and wrote off loans worth around £6.8m. Royal Bank of Scotland also swapped £7.5m of mezzanine loans for a 29.5% equity stake, which helped it to bring down its net debt and allowed it to make the acquisition of onlinegolf.co.uk’s parent firm, SW Golf.
CEO Nick Wood said: “LDC has been a hugely supportive, long-term investment partner over the last eight years. Its commitment has enabled us to build a market-leading business with a highly scalable platform for growth.
“This is an exciting time for everyone at the business as it embarks on its next phase of growth. Sun’s experience and sector knowledge will be extremely valuable in driving our expansion into 2012 and beyond.”
Chris Hurley, UK portfolio managing director at LDC, said: “American Golf has made excellent progress with its growth strategy against one of the most challenging retail climates for several years, thanks to a clear proposition, highly capable management team, first-class store execution and growing online platform.
“Under the leadership of Nick Wood, the business has accelerated both revenue and profits growth significantly over the last four years, and is now well placed to continue driving market share. We wish the business every success for the future.”
The deal is subject to regulatory approval and should complete within the next 30 days. The vendors were advised by investment bank Rothschild.
