Titlelist golf balls

Phil Young of the U.S. was playing golf one day when he scored poorly as the ball rolled badly despite a fine putt. He grew curious over what the ball looked like inside and took it to a hospital where his friend worked for an X-ray. Surprisingly enough, the shapes of the cores made of high-elastic rubbers were uneven. Thinking that the consistency of spinning would improve by evening the cores, he set up the golf ball maker Titlelist in 1932. Since 1949, his balls have remained the top seller in the world. Korean golfers K.J. Choi and Shin Ji-yai have won tournaments by using this ball.

The world`s top golf ball maker will soon become a Korean company. A consortium comprising private equity fund Mirae Asset and Fila Korea will take over golf equipment maker Acushnet, which owns Titlelist and golf shoe maker FootJoy. With Korean golfers about to make their 100th win in the LPGA, Korea will add one more prize, a global golf equipment maker. In the bidding, the consortium beat Germany’s Adidas Group that owns TaylorMade and U.S.-based Calloway Golf that formed a consortium with Blackstone, the world’s largest private equity fund manager.

Acquisitions usually involve the lead of strategic investors and funding by financial investors more interested in investment returns than corporate management. Mirae analyzed which companies to take over and brought in Fila Korea as a strategic investor. For a 100-percent stake in Acushnet worth 1.2 billion U.S. dollars, Mirae and private equity funds will pay 600 million dollars and Fila Korea 100 million dollars. The remaining balance of 500 million dollars will be borrowed from Korea Development Bank.

This is the first time for a Korean company to take over a global No. 1 brand. Mirae Asset Chairman Park Hyun-joo said, “The opportunity came as Korean asset management companies successfully made inroads into the global stage.” Fila Korea, which will manage the company, said it will leverage its strength in the apparel sector to combine it with the Titlelist brand. One advantage of taking over foreign companies is that source technologies and brand power can be secured at the same time. Japanese companies are also aggressively targeting global companies due to the strong yen.

Editorial Writer Hong Kwon-hee (konihong@donga.com)