Golf apparel retailer Ashworth Inc. called a Mulligan and put itself back on the auction block in September for the second time in three years. This time, however, the Carlsbad, Calif.-based company scored an Ace when the world's second-largest sports goods maker Adidas SA agreed to buy it for $1.90 per share in
cash, in a deal valued at about $26.5 million.
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Adidas will pay a premium of
almost 10% over Friday's closing price of $1.73 a share. The German company will
also assume $46.3 million of the target's
debt.
Adidas picks up a company that has been struggling lately. In its
latest third-quarter earnings results, Ashworth posted revenue of about
$45 million, a decrease from $49.5 million for the same time period in
2007.
Ashworth first put itself on the block in November 2005,
when it hired Houlihan Lokey Howard & Zukin Inc. The move
generated no worthy bids so Ashworth decided to remove the for-sale
sign in January 2007 and focus on improving operations. - Gerald Magpily
See Dealscape: Reebok becomes splinter in Adidas' foot
