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We had to know something was wrong when Cobra announced that they were "exiting the market for Tour level equipment" - as I wrote here when that was announced, something just did not smell right. Well, today the other shoe fell. Many reports had surfaced over the last several months that Puma was trying hard to get into the equipment business...and those reports have at last come true.
Puma announced today that it had reached agreement with Acushnet (parent company of Titleist, FootJoy, and Cobra) to acquire Cobra Golf. Acushnet bought Cobra for $700 MM in 1995, and Cobra reported sales of $200 MM in 2008. Using some middle of the road multiples on the deal, it's not likely that Acushnet made any real profit (especially considering they held onto it for 15 years...)
This deal raises some interesting questions relative to the players...
- Cobra has a very respectable stable of young guns (Villegas,Poulter, and JB Holmes) ...I can't imagine that Titleist is anxious to lose their connection with them, as all of them have won within the last year.
- Meanwhile, Puma's "face" on the Tour (Rickie Fowler) is a die hard Titleist loyalist from a hardware perspective (Driver,Irons,Wedges,Putter,Ball, Glove, etc). I will be curious to see if they apply any pressure to switch
- Finally, Puma's previous "face" on Tour, Geoff Ogilvy, has just switched from Cobra to Titleist this year...and I can't help but think there are some bruised feelings somewhere in there.
- Rumor has it that the Olsen twins somehow play into an outing with the next Cobra staff player to win. Somewhere, Camilo is smiling...
Anyway, I hope the deal is good for all involved. It's great to see an international brand like Puma enter the golf equipment business, as they will surely need deep pockets to play in that arena.
