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The deal comes three months after ClubCorp announced the
retirement of is CEO Eric Affeldt and said it had decided not to
pursue a "strategic transaction," after efforts to explore a
sale did not result in any offer for the entire company.
However, the Dallas-based company had kept the strategic review
committee of its board of directors in place, and had yet to
announce Affeldt's successor. It has struggled to turn a profit,
as its strategy of boosting its golf club memberships through
promotions, refurbishments and acquisitions has proved costly.
Apollo said it will pay $17.12 per share in cash for ClubCorp, a
30.7 percent premium over its closing price on Friday, but less
than the 12-month high of $17.50 the shares reached in February,
on investor expectations that a sale process first reported by
Reuters in January would be successful.
ClubCorp also declared on Sunday a one-time dividend of 13 cents
per share to be paid later this month. It said the sale to
Apollo is expected to close in the fourth quarter of 2017.
Founded in 1957, ClubCorp operates more than 200 properties,
including golf and country clubs, business clubs and sports
clubs across the United States, Mexico and China, serving more
than 430,000 members.
In May, the company reached a settlement with activist investor
FrontFour Capital Group LLC to add two independent directors to
its board. FrontFour had called for exploring several options,
including a sale.
ClubCorp has been a serial acquirer in the golf course industry,
buying dozens of courses in the last three years. It has sought
to buy locally owned golf courses and refurbish them by adding
or improving amenities such as up-scale dining and event rooms.
KSL Capital, another private equity firm, acquired ClubCorp for
$1.8 billion in October 2006 and took it public in 2013.
Jefferies LLC and Wells Fargo acted as financial advisers
ClubCorp and Simpson Thacher & Bartlett LLP is its legal
counsel. Citigroup is acting as lead financial adviser to
Apollo, with RBC Capital Markets LLC, Barclays, Credit Suisse
and Deutsche Bank also advising. Paul, Weiss, Rifkind, Wharton &
Garrison LLP is Apollo's legal counsel.
(Reporting by Greg Roumeliotis in New York; Editing by David
Gregorio)
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