Centroid Investment Partners, a Seoul-based private equity firm, is shortlisted as one of the potential buyers of TaylorMade Golf Co., a California-based golf equipment sponsor of Tiger Woods, with a price tag of more than $2 billion.

Morgan Stanley, running the sale for KPS Capital Partners, will hold a tender next week and name the preferred bidder by the end of this month, according to industry sources on Thursday. The Korean private equity firm will vie with strategic investors from the United States and China for TaylorMade.

TaylorMade is a golf equipment maker based in Carlsbad, California. It is the sponsor for many noted PGA Tour players, including Tiger Woods, Dustin Johnson and Rory McIlroy. KPS Capital Partners, an American private equity firm, bought TaylorMade from Adidas in 2017 for $425 million.

The price tag for TaylorMade is estimated at more than $2 billion, considering that it made around $100 million in annual EBITDA (earnings before interest, taxes, depreciation, and amortization) in 2020 and the enterprise-value-to-EBITDA multiples of its rivals like Acushnet and Callaway average at 14 to 20.

Centroid Investment Partners is a mid-sized private equity fund established in 2015. It recently acquired a golf club at 170 billion won ($152 million) from BGF Group.

The Korean PEF reportedly is seeking to form a consortium with other strategic investors in Korea to win the TaylorMade deal. Multiple names from the fashion and golf sectors are said to have shown interest.

Centroid Investment will likely raise half of the acquisition fund from Korean institutional investors and the rest through acquisition financing. It is said to have already completed talks with potential investors and will likely source the remaining funds easily, given the flourishing golf industry across the world during the Covid-19 pandemic.

According to analytics firm Golf DataTech, golf equipment sales in the U.S. jumped 10.1 percent to $2.8 billion in 2020 against 2019. The sales record is the highest since 2008.

The golf industry is thriving not just in the U.S but across the world. Grand View Research projects the worldwide golf club market to reach $4.45 billion in 2027 after growing 2.5 percent on average every year.

By Kang Doo-soon, Jin Young-tae, Kang Woo-seok and Cho Jeehyun

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