The consortium of buyers includes Fairfax Financial Holdings Ltd. and CI Investments Inc.'s Signature Global Asset Management, according to a news release yesterday.
The Austin, TX-based chain is loaded with debt and wasn't able to find a buyer to rescue it, according to news outlets, though Dick's Sporting Goods may be interested in acquiring Golfsmith and its some 100 US stores under bankruptcy, sources told the New York Post.
The purchase price was not immediately revealed.
The company, which was founded in Edison in 1967, is expected to reduce its retail footprint in the U.S.as it struggles with millions of dollars of debt.
The company said it plans to sell itself as a going concern and partially liquidate the business. "Today represents a significant step forward for the long term-viability of the Golf Town and Golfsmith businesses". Concurrent with the Chapter 11 filings, Golf Town commenced proceedings under the Companies' Creditors Arrangement Act (CCAA) in the Ontario Superior Court of Justice (Commercial List).
USA stores have suffered because of either over saturation in certain markets or being too large in general, said a source close to the matter. However, if the plan fails, the company plans a full liquidation.
Golfsmith has been headquartered in Austin since 1973, and has about 350 employees in Central Texas.
In addition to shuttering stores, Golfsmith's restructuring calls for a reduction in the amount of its junior bonds by roughly 72% and the refinancing of its senior debt.
The orders issued by the Bankruptcy Court and the CCAA Court will help the Company continue its business in the normal course while the Company works to achieve long-term financial stability through the implementation of various transactions aimed at maximizing value for its stakeholders.
The first round of expansion began in 1995.