Fila buys Titleist for $1.23b

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Fila Korea is buying Acushnet, the Titleist golf ball and club maker from Fortune Brands Inc’s for $1.23 billion.

A group led by Fila Korea is buying Acushnet, the Titleist golf ball and club maker, from Fortune Brands Inc’s for $1.23 billion, beating off competition from private equity fund the Blackstone Group among others.

Fortune, under pressure from activist investor William Ackman, last year announced plans to sell or spin off its Acushnet golf unit as well as its home products business, which makes Simonton windows and Moen faucets.

Fila Korea, an ambitious footwear and sportswear retailer, acquired the global Fila name in 2007 from Sports Brands International, a unit of hedge fund Cerberus Capital Management.

The deal gave Fila Korea rights to the worldwide use of the brand on the footwear and apparel of the parent firm, established in Italy in 1911.

Fortune said it expects to realise net proceeds of around $1.1 billion from the sale after taxes and expenses. The deal is likely to close in the summer.

The auction attracted interest from private equity fund Blackstone, which teamed up with Callaway Golf Co sources recently told Reuters.

Fortune sought the advise of Morgan Stanley as it explored options for the golf unit.

Nomura Holdings and KDB also advised Fila on the deal.

Acushnet had revenue of $1.24 billion and operating income of about $80.2 million last year.

Final bids were submitted in early May.

The golf unit, which also makes FootJoy shoes and gloves, had about $100 million in cash flow last year, and some analysts had estimated the sale would fetch between $800 million and $1 billion

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