Font Size
Join our Mailing List
Home Show me the money!

Golf has always been a numbers game. So too is any business. Edwin Watts Golf Shops, LLC entered Chapter 11 Bankruptcy Court protection in Delaware on Monday with the intention of selling the operating assets of the business. The company and its advisors have been in advanced negotiations with multiple parties, prior to the bankruptcy filing, and expect to file sale agreement documents with the Delaware Bankruptcy Court shortly. Court filings indicate that Edwin Watts will seek a sale of its assets by Dec. 6 through a court-supervised auction. An initial or “stalking-horse” bid was reached with a joint venture of Hilco Merchant Resources LLC, a liquidator, and Worldwide Golf Shops affiliate GWNE Inc. GWNE plans to operate the stores it buys. PNC Bank, which is owed $50 million under a secured financing agreement, will lend Edwin Watts $38 million to keep it operating until the sale is completed.

Callaway Golf Co. (ELY) is considered the largest unsecured creditor, with a claim of $4.6 million, according to papers. However, TaylorMade ($3.824 million) which also owns Adams Golf ($1.186 million) is owed in excess of $5 million between its two businesses from the retailer. Titleist ($3.188 million) and its sister company FootJoy ($1.544) are owed a combined $4.732 million, according to court papers. Among some of the more notable companies in the top 30 creditors listed, according to the court filing is:

Nike Golf is owed $1.789 million

Cobra Puma Golf is owed $1.54 million

Cleveland Golf is owed $1.085 million

Karsten Manufacturing (PING) is owed $694,898

Wilson Golf is owed $671,917

Mizuno is owed $384,100

Tigershark Golf is owed $366,767

Bridgestone is owed $310,433

Bushnell is owed $305,705

US Kids Golf, LLC is owed $256,276

Oakley is owed $220,147

Heavy Putter is owed $173,938

Pride Manufacturing is owed $162,826

Seemore Putter Company is owed $151,507

Tour Edge is owed $149,161

Garmin International is owed $135,773

Winn Grip is owed $103,522

Dynamic Brands is owed $102,766

Sun Mountain Sports is owed $95,063

The total amount the retailer currently owes, according to court papers, among its top 30 creditors is more than $24 million. There is an excellence chance that several of the top creditors were informed by the retailer of its plan in advance of when the actual filing took place this week. Therefore, some if not most creditors shouldn’t have been caught off guard, in large part since they hadn’t been paid and the retailer is actively attempting to sell it. Watts is attempting to maintain itself as a “thriving” entity and will need to count on the creditors to supply it with products in the future. However, its unknown at this juncture to what extent these creditors will receive any portion of the amounts owed. Depending on the ultimate sale price of the company the proceeds will go towards paying off secured loans first with anything left over going toward unsecured creditors on an even basis.