Ever since Adams Golf announced on Jan. 4, 2012 that it was "examining strategic alternatives," there has been speculation about what would happen to the brand. In the interim, rumors that TaylorMade was interested in acquiring Adams circulated. Those rumors became reality Monday morning as TaylorMade announced it had reached an agreement to acquire all of the outstanding shares of Adams Golf for $10.80 per share in cash, or roughly $70 million. According to a statement from TaylorMade, it will maintain Adams' headquarters in Plano, Texas.
"This acquisition reflects our commitment to continued growth in the golf category," said Herbert Hainer, CEO of adidas Group, TaylorMade's parent company. "The proposed combination of Adams Golf and TaylorMade-adidas Golf brings together two highly complementary sets of brands, combining Adams' focus on game-improvement as well as senior and women golfers with TaylorMade-adidas Golf's focus on the younger and the low-to-mid handicap golfer."
The acquisition by TaylorMade caps a whirlwind few weeks for Adams, which posted sales of $96.5 million in 2011. CEO Chip Brewer left Adams for Callaway Golf on Feb. 28 with company founder Barney Adams taking over as interim CEO.
The adidas Group plans to finance the acquisition with cash on hand or through existing credit lines and the transaction is subject to standard closing conditions and regulatory approvals as well as approval by Adams Golf shareholders. Those are expected to be mere formalities, however, and the transaction is expected to close mid-2012.
-- E. Michael Johnson*