Worldwide Golf Shops is exploring making an offer for Golfsmith International Holdings Inc., according to Reuters. Sources told the news service they weren’t sure if Worldwide Golf was eyeing Golfsmith’s entire U.S. business or individual leases and assets.
Financial investors are also interested in the U.S. business of Golfsmith, a source told Reuters.
On September 14, Golfsmith filed for Chapter 11 bankruptcy protection with a plan to sell its Canadian-based business of Golf Town and recapitalize or sell its U.S.-based retail Golfsmith business.
A definitive agreement has been reached to sell Golf Town to Toronto fund manager CI Financial Corp. and Fairfax Financial Holdings Ltd. Fairfax and CI collectively, through funds or other entities managed or controlled by them, hold more than 40 percent of the company’s second lien secured notes due 2018. Golf Town has 55 stores in Canada.
At the same time, a support agreement has been reached with Fairfax and CI with respect to a recapitalization and restructuring of the U.S.-based business of Golfsmith. The company also indicated it would be exploring a sale of its U.S. business to see if it offers a better return to creditors.
Last Thursday, a Delaware bankruptcy court judge approved the bidding process for the company. Bids are due on October 17, and an auction is scheduled to take place on October 19.
Golfsmith operates 109 stores under the Golfsmith banner and has identified 20 stores for closing.
Worldwide Golf operates 89 stores and nearly doubled its size with its 2014 acquisition of Edwin Watts. The retailer’s portfolio ranges from Roger Dunn Golf Shops in California and Hawaii, The Golf Mart in California, Vans Golf Shops in Arizona, Golfers’ Warehouse in New England, Uinta Golf Shops in Utah and Edwin Watts Golf Shops in the Southeast.