Topgolf tees up next chapter
“Callaway Golf owned us before, and they still own about 15 percent of the company, which is similar to what it was before we [Topgolf] merged with them back in 2021 or 2022,” Topgolf director of sales Aaron Gicking said. “So, we're still going to have all their equipment, the golf balls, the golf clubs, all of that.
“[Callaway] are definitely more focused on the retail side of things, whereas, we are more entertainment and food and drink,” he said.
Still, “I'm very sure they were very happy with everything," Gicking said. “We continued to grow under their leadership, and we're going to continue growing even though we are now with the Leonard Green company now.
“They have a really strong showing for everything they've done in the past,” he said. “We're really looking forward to everything that is coming in the future now that they are here at Topgolf, too.”
According to a news report by Ella Masters of News and Events, Topgolf Callaway Brands sold a majority stake in its Topgolf business to a “private equity heavyweight, Leonard Green & Partners.”
Leonard Green & Partners, L.P., a Los Angeles-based private equity investment firm has acquired many companies, such as Whole Foods, Petco and David's Bridals, Gicking said.
Master stated in her article, “The deal values Topgolf at approximately $1.1 billion — a significant drop from the implied about $2 billion valuation when the two companies merged in 2021
“Callaway is selling a 60 percent controlling interest to Leonard Green & Partners but will retain a 40 percent minority stake,” she stated. “Callaway expects to pocket roughly $770 million in net proceeds, which will likely be used to pay down debt and buy back stock.
“The deal is expected to close in the first half of 2026,” Masters added. “When Callaway fully acquired Topgolf in 2021, the thesis was synergy: Callaway would own the equipment, and Topgolf would own the new wave of casual golfers. It was supposed to be an unbeatable ecosystem. So what went wrong?
“Despite Topgolf’s popularity, building massive entertainment venues is expensive,” she stated. “The capital-intensive nature of Topgolf weighed heavily on Callaway’s balance sheet, dragging down the stock price even when the equipment side was performing well. Investors grew tired of the volatility.”
Also, Masters added, “Callaway is a premium equipment and apparel company – think drivers, Odyssey putters and Travis Mathew.
“Topgolf is a hospitality and entertainment business,” she stated. “Managing both under one roof proved difficult with distinct operating models that didn’t blend as seamlessly as hoped.
“Once the deal closes, the parent company will rebrand,” Masters stated. “Topgolf Callaway Brands will disappear, and the company will revert to its classic name, Callaway Golf Company.
“Even the ticker symbol is going back to its roots,” she stated. “They are ditching MODG (Modern Golf) and bringing back CALY. This signals a clear message to the market: Callaway is refocusing on what it does best — making world-class golf clubs and balls.”
“For the average golfer,” Master stated, “don’t expect your local Topgolf to close. In fact, private equity ownership often brings an injection of cash to streamline operations, which could mean better service or refreshed technology at venues.
“For Callaway loyalists, this is good news,” she stated. “With the distraction of running a massive venue business removed, Callaway can pour its resources back into R&D. We might see even more aggressive innovation in the equipment space as they look to defend their market share against Titleist and TaylorMade.”
In all, Masters stated, “This split proves that in the golf business, ‘bigger’ isn’t always better. The synergy of ‘on-course’ and ‘off-course’ golf sounded great in a boardroom, but the market clearly prefers a specialist.
“Callaway is betting that by cutting Topgolf loose, it can unlock the value that has been trapped in their stock for years,” she added. “It’s a bogey on the merger, but hopefully, a birdie for the future strategy.”
Still, Gicking said, “Nothing with Topgolf is changing. Everything is still going to be as great as anything.
“We're still going to have the same great culture,” he said. “We're going to continue expanding.
“I know there were talks of doing upward of five new venues a year across the United States," he said. “We have four in Tennessee, and they're continuing to grow and expand across the United States, and we've got several that are international venues as well.”
At Topgolf, its customers can expect more competitive prices.
“We understand that there's a lot more competition now than when Topgolf first opened, not just here,” Gicking said, noting at the first Topgolf that opened, there are six eat-and-play locations.
“We're going to continue doing everything we can," he said. "We've got new menu changes every couple of months. They're constantly looking at ways to give us better prices to our players who are coming to the venue so they can get more bangs for their buck.”
"The merger with Leonard Green is really about giving our team more tools to work with and less restrictions overall," Gicking said.
He noted Topgolf is similar to Main Event, in that "you don't have to be an excellent bowler to go out to Main Event.
"You just want to go out and have a great time and that's what we provide here," Gicking said. "We provide all the equipment that you need and we've got upward of 15 different games you can select from for all skill levels.
"We've got great food, great drinks and it's an overall great experience," he added.
Topgolf is open from 9 a.m. to 11 p.m., Sunday through Thursday, and from 9 a.m. to midnight, Friday and Saturday.
"We do accept walk-ins," Gicking said. But, "I would say on the more popular nights, like Friday or Saturday, they can book reservations directly through the Topgolf app or through the website at topgolf.com/us/Knoxville/
For more information, call 865-672-0311.
