Callaway Golf Company has announced to have entered into a definitive agreement to acquire TravisMathew, a high-growth golf and lifestyle apparel company, for $125.5 million in an all-cash transaction.
Chip Brewer, President & CEO, Callaway Golf said: “We are very excited about this acquisition. With its golf heritage, culture of product excellence and double-digit growth in the golf and lifestyle apparel business, TravisMathew is a great fit with our business, brands, culture and our strategy to grow in areas tangential to golf. This acquisition, once completed, is expected to be slightly accretive to earnings in 2018 and create significant value for our shareholders over the long-term. We look forward to working with the TravisMathew management team to maximize this brand’s growth potential.”
Post-acquisition, TravisMathew will continue to operate out of its Huntington Beach, California headquarters.
The purchase price values TravisMathew at a multiple of approximately 11.8 times projected 2017 full year adjusted EBITDA. Callaway also expects to realize significant value from potential tax benefits associated with the transaction.
Callaway intends to finance the transaction with cash on hand and borrowings from its asset-backed credit facilities. Latham & Watkins LLP acted as legal counsel and Lazard acted as financial advisor to Callaway. Baker & Hostetler LLP acted as legal counsel and Moss Adams Capital LLC and Optivest IB acted as financial advisor to TravisMathew.