Sequoia Golf to be sold to ClubCorp for $265M
by Clay Neely
Newnan-based Sequoia Golf will sell its stock and assets to Dallas-based ClubCorp for $265 million, the companies announced Wednesday.
Sequoia currently owns or operates 50 private clubs, semi-private and resort golf facilities located across the U.S. Among those in the area include Canongate I Golf Club, White Oak Golf Club, Flat Creek, Planterra Ridge, and Braelin golf clubs in Peachtree City.
ClubCorp, a publicly-traded company (NYSE: MYCC), is a leading owner-operator of private golf and country clubs, as well as business, sports, and alumni clubs in North America.
“Our sale to ClubCorp is very exciting for Sequoia and its members,” according to Joe Guerra, Sequoia president and CEO.
Guerra, who will serve as a senior advisor to ClubCorp, noted, “ClubCorp is known for maintaining extremely high standards in club management and investing to improve members’ experience.”
Sequoia’s desire to grow and access capital was the driving force behind the sale of the company, Guerra said in an interview with The Newnan Times-Herald. “We feel that this sale provides a positive outcome for our shareholders, employees and members.”
The acquisition comes as the golf industry has found itself in a rough spot – dealing with declining membership and other challenges.
According to the National Golf Foundation, about 400,000 players left the sport last year. While almost 260,000 women took up golf, some 650,000 men quit.
“Golf is in a bit of a drought,” said Allen Adamson, managing director at brand consulting firm Landor Associates in New York. “It’s a pretty high-price sport, and leisure time is getting crunched.”
Playing the sport is also becoming more difficult, as more than 150 courses shut down in the U.S. last year, marking the eighth straight year that more courses closed than opened, according to the National Golf Foundation.
The people sticking with the sport are playing fewer rounds than before, often opting for nine holes rather than 18. In total, U.S. golfers played 462 million rounds last year, according to Golf Datatech. That was the fewest number since 1995.
“While there has been talk about the decline of golf, if you look at our sector, we’ve seen positive growth,” Guerra said. “We selected this shift in ownership because it is going to be best for the immediate and long-term interests of Sequoia and Canongate, leading to greater opportunities for its staff and club members.”
“We are thrilled to combine our industry leading collection of clubs with Sequoia Golf,” said Eric Affeldt, ClubCorp’s president and CEO. “Our combined membership base will benefit from an unmatched opportunity for reciprocal usage.”
According to Guerra, the sale means current members can expect many new benefits and service improvements over the next several months. And while the company will now be headquartered in Dallas, the Newnan office will remain open for the foreseeable future.
Last summer, Sequoia canvassed a number of banks, partners, buyers, and other publicly traded companies. After six months, Guerra felt that it was clear that ClubCore was the right fit.
“Our decision was made in the best interest of our employees, our members and for the communities that we operate in,” Guerra said. “It’s a winning combination for everyone.”
The deal is currently set to be finalized around the middle of September or early October.
Sequoia was created by Guerra and its founding partner, Parthenon Capital, which has worked with the company since its inception.
Launched in 2003, Sequoia acquired the original seven Canongate properties in south Atlanta for approximately $55 million from the Patten Seed Company that was controlled by the Roquemore family. Since then, Sequoia has grown to include 50 owned, leased or managed golf and country clubs, throughout the U.S.