Cleveland Golf Sold
The long-rumored sale of Cleveland Golf has come to fruition, although the buyer came out of the dark, with SRI Sports Ltd. (parent of Srixon) landing Cleveland (which was owned by Quiksilver) for $132.5 million, according to a source familiar with the negotiations. The deal is expected to close before January 31, 2008 with net proceeds from the sale being used to pay off debt. Quiksilver acquired Cleveland in two separate purchases (as part of its acquisition of Rossignol in July, 2005 and a separate deal two months later for the remaining portion).
SRI (which also own the Dunlop name in Japan and, according to its financial report, had net sales of $2.2 billion for the first six months of 2007) is the largest equipment company in Japan, but a brand still trying to gain traction in the U.S. The marriage, however, does make sense. Although also a maker of clubs, Srixon's primary market in the U.S. is in golf balls and according to Srixon's web site, Sumitomo is the No. 1 patent holder of golf-ball technology in the world. Cleveland, meanwhile, has established itself as a maker of clubs and does not have a golf ball in its line. Srixon currently has 70 tour players worldwide on its staff, including Jim Furyk, Robert Allenby, Tim Clark and Henrik Stenson. Cleveland also has an extensive tour staff headed by Vijay Singh.