Eight months after being sold by Callaway, Topgolf’s new business plan under private equity ownership is centered around balancing the need to get the size and scale of the company just right, while managing expansion efforts.
In November, Topgolf Callaway Brands agreed to sell majority control of Topgolf to PE firm Leonard Green & Partners in a deal that valued Topgolf at $1.1 billion and unwound the 2020 merger of Topgolf and Callaway. Leonard Green acquired a 60% stake in Topgolf, while Callaway—which remains publicly traded as Callaway Golf Company—still holds the remaining 40%. The deal closed in January.
“Part of the benefit of being private right now is for us to reset that business plan, and I think ultimately there’s great upside in the valuation of the company,” new Topgolf CEO David McKillips told Front Office Sports last week at the Open Championship. The new $1.1 billion valuation is down from $2 billion when Topgolf merged with Callaway six years ago.
Sitting atop the grandstands overlooking the drive range at Royal Birkdale, which uses Topgolf’s Toptracer technology, McKillips discussed his first few months with the company and long-term vision. Most recently the president and CEO of Chuck E. Cheese Entertainment, McKillips was hired by Topgolf in February, shortly after Leonard Green took over full control of the company. In May, McKillips decided to lay off 300 employees, which cut $40 million from Topgolf’s balance sheet.
