Global sports groups are circling the Titleist golf brand, which sponsors European Ryder Cup player Rory McIlroy, ahead of a May deadline for bids for the business, which is being sold by Fortune Brands of the US.

Adidas and the Japanese owner of the Srixon golf brand were expected to submit offers for the unit, which trades as Acushnet Company, by the May 9 deadline, said people familiar with the process.

Callaway, the US-listed golf company, may also team up with a private equity group to submit a bid.

Acushnet, whose Titleist balls are used by two-thirds of professional golfers, was expected to generate interest from other private equity buyers, said people close to the deal.

The business could be valued at between $1bn to $1.2bn, although some cautioned that those estimates were the top-end of the likely range.

A smaller group of sponsored players use its clubs, gloves and Footjoy shoes, including 21-year old Mr McIlroy from Northern Ireland, who missed out on winning the Masters tournament in Augusta this month when having led the competition, his final round went awry.

Fortune Brands, Adidas, Callaway and SRI Sports, which owns the Srixon brand and is itself owned by Japan’s Sumitomo Rubber Industries, declined to comment.

Fortune, which also owns Jim Beam and Maker’s Mark bourbon and has a housing products division, said in December that it would split itself into three, having come under fire from activist investor Bill Ackman.

The company said this week that its plans were progressing well.

The golf business has been earmarked for a sale or spin-off, followed by a separation of the home and security business.

The standalone spirits business would then trade as Beam Inc, the company said, adding it had no plans to change the Acushnet name, which came from the Massachusetts town where the first Titleist ball was made in 1935.

Fortune Brands’ stock has risen more than 20 per cent during the past six months, as investors cheered the plan to split.

The shares were trading at $65.03 on Friday afternoon.

People familiar with the matter said the golf business made about $100m a year in earnings before interest, tax, depreciation and amortisation.

Achieving the discussed price for the business would rely on potential buyers believing they see significant growth in the popularity of golf, they added.

The business tends to fluctuate with the economic cycle, but buyers may also see opportunity for growth in countries such as China, as the emerging middle class embraces golf as a leisure and networking pursuit.

Get alerts on Beam Inc when a new story is published

Copyright The Financial Times Limited 2019. All rights reserved.
Reuse this content (opens in new window)

Comments have not been enabled for this article.

Follow the topics in this article