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Volume 27 No. 10
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Topgolf Begins Preparations Toward An IPO Potentially Valued At $4B

Topgolf is working with JPMorgan Chase and Morgan Stanley as it prepares for an IPO that "could be valued" at $4B, according to a source cited by Halkias & DiFurio of the DALLAS MORNING NEWS. Topgolf has been "expanding rapidly, from 39 locations two years ago to 60 last month with the opening of a three-level, 65,000-square-foot facility in Cleveland." It has three locations in the U.K. and one in Australia. Late last year, Topgolf said that it was "expanding into Mexico, Canada, Europe and Asia." Renaissance Capital Senior IPO Market Strategist Matt Kennedy said that Topgolf "would be the first company of its kind to go public since the Dallas-based Dave & Buster's IPO" in late '14. Topgolf has an "abundance of markets left where it can open, and developers are aggressively going after the entertainment venue that combines golf with food and drink." Entertainment retailing is a category that shopping centers are "adding to reinvent ailing properties with good real estate." Analysts praise the brand for its "first-mover advantage, a national reputation, various versions of its locations under development and proprietary technology, all qualities that make it tougher for potential competitors" (DALLAS MORNING NEWS, 1/7). BLOOMBERG NEWS' Tan, Deveau, Porter & Hytha cited sources as saying that Topgolf's IPO "could come as soon as this year." Topgolf, led by CEO Dolf Berle, has $525M in "outstanding debt" (BLOOMBERG NEWS, 1/6).

TWITTER REAX: Golf writer Ryan Ballengee noted if the $4B number is accurate, "Callaway's 14% stake would then be worth $560 million." Beyond The Game Network's Brian Zwerner: "This #IPO is worth a hard look. Can’t wait to see the details in the filing. It feels like TopGolf has another wave of expansion with their smaller format Swing Suites rolling out." Protocol.com's Mike Murphy: "Topgolf feels like the future of golf in a world that won’t put up with the resource hogs that are golf courses."