Less than four months after an investor
urged ClubCorp to consider a sale, the
public company may be doing just that,
according to sources and a recent U.S.
Securities and Exchange Commission filing.
The Dallas-based company said it has
formed a committee to review and evalu-
“The committee is focusing on oppor-
tunities to further unlock the value inher-
ent in the company,” ClubCorp said in
the filing. “The committee is evaluating
opportunities with a focus on maximizing
value for all shareholders.”
Reuters reported that the world’s largest
owner of private clubs is in the early stages
of an auction process that has attracted
interest from private equity firms and
other potential buyers.
In September 2016, FrontFour Capital
criticized ClubCorp’s stock and called
for the company to “retain an investment
ClubCorp to examine sale,
bank to pursue any and all strategic alter-
natives, including an outright sale of the
FrontFour owns 3.4 percent of
ClubCorp’s outstanding shares. At the
time, ClubCorp’s stock was $14.25 per
share, down 36 percent from the pre-
vious year. Since then, the company’s
stock plunged to a low of $10.90 in early
November, but rebounded to $17 in
FrontFour has valued the stock at $27
and said a sale would enable ClubCorp to
pay off some of its debt and, in the process,
boost the value of its under-performing
stock. It said ClubCorp owns the land at
126 of its 160 golf and country club properties, for a total of roughly 30,000 acres
that is worth $1.5 billion.
“We believe that ClubCorp’s portfolio of
assets, which includes 30,000 acres of fee
simple acreage, would garner significant
strategic and financial interest from a vari-
ety of parties,” FrontFour wrote. “Given
ClubCorp’s currently depressed valuation,
projected decline in capital expenditures
and the potential near-term exhaustion
of tax mitigation strategies, the strate-
gic alternatives process should consider
whether the right time is approaching for
a conversion to a [real estate investment
trust] in order to unlock significant value.”
The committee will report its findings
directly to ClubCorp’s board of directors.
ClubCorp CEO Eric Affeldt has said
the company’s story and financials are not
well understood, primarily because it is
the only public golf entity in the U.S. KSL
Capital, a private equity firm, acquired
ClubCorp in 2006 for $1.8 billion, and
took the company public in 2013.
ClubCorp reported gross revenue of
$1.1 billion in 2016, with a net income
of $4 million. It continues to acquire
clubs and invest into upgrading them. It
recently acquired Eagle’s Nest Country
Club, a member-owned country club
just north of Baltimore, and North Hills
Country Club, just north of downtown
Philadelphia. It expects to invest $40 million in 2017 into these and other clubs.
new private club service
KemperSports has launched a new service
for private clubs that will provide back-of-
the-house administrative services.
Named BackSpin Club Services, it will
offer payroll and benefits administra-
tion, human resources guidance, bench-
marking and purchasing power through
BackSpin’s national buying network
focused on the specific needs of private
BackSpin clients will also get exclusive
access to a la carte consulting services to
maximize a club’s potential while allowing
the club’s leadership to maintain full con-
trol of day-to-day operations.
KemperSports also recently announced
it will manage The Country Club of St.
Albans in St. Albans, Mo., one of the pre-
mier private clubs in the St. Louis market.
Firestone Country Club in Akron, Ohio,
one of ClubCorp’s many courses.