Had an interesting conversation with a Nickent rep today...

[Pinged]

AND- he had the CYG hosel mounted up on an Evolver shaft- VERY COOL!!

That said, I rather jokingly asked him if his paychecks were still clearing the bank and he looked very somber and said, "Yeah... so far."

I said, "I've heard some rumors" and he said, "Yeah... I've heard them too. The latest two I'm hearing are that both Puma and Under Armor are looking at buying Nickent."

So what's that information worth? About as much as you and I paid for it- just another rumor. But I thought it was an interesting one. The guy said he HOPED the company found a buyer while it was still a viable enterprise.

We will see...

 

[JB]

Pinged, we would love that, but here is my take on it. The debt is too high and it outweighs the assets by a large amount. I would be shocked if someone bought the company as is. As someone that has dealt with buying and selling companies a lot over the past 6 years, this one would be a tough sale unless they can leave the debt behind and just buy the assets. That is a common practice with biz sales obviously, however in this case, that debt would still be owed and I am not sure it could happen.

I had heard the PUMA one for a while now and according to PUMA directly, it is just not the case. However we all know that what they say may not be what actually happens.

 

[Pinged]

Pinged, we would love that, but here is my take on it. The debt is too high and it outweighs the assets by a large amount. I would be shocked if someone bought the company as is. As someone that has dealt with buying and selling companies a lot over the past 6 years, this one would be a tough sale unless they can leave the debt behind and just buy the assets. That is a common practice with biz sales obviously, however in this case, that debt would still be owed and I am not sure it could happen.

I had heard the PUMA one for a while now and according to PUMA directly, it is just not the case. However we all know that what they say may not be what actually happens.

Interesting JB. I'll have to say the guy looked pretty down in the mouth. There were 15-16 companies set up on the line for demos and fittings this weekend. Everybody from Titleist and Ping to Callaway, Taylormade, Mizuno- ALL of them. They all seemed busy--- except for the poor Nickent guy. He had one guy demoing a hybrid and that's it. Everybody else seemed to have 4 or 5 tees busy and 4 or 5 more customers waiting their turn. It's pretty sad because they really ARE nice products.

 

[JB]

Yeah, I agree Pinged. But in the end, if people do not know of a product, how do you get it to them? I think one of the biggest mistakes companies make is by trying to compete in ALL markets. Nickent should have stuck at the beginning as a hybrid company. They make arguably the best out there, but spending so much money on everything else, regardless of how good it is, can give them less money to spend on marketing.

 

[JB]

One more thing to add that most people forget about. The economy has not only affected the consumers buying clubs, but even moreso retail stores are buying less and less than ever before.

 

[Pinged]

One more thing to add that most people forget about. The economy has not only affected the consumers buying clubs, but even moreso retail stores are buying less and less than ever before.

Good point, JB. It was interesting to see people CRAWLING all over this golf store today. There must have been 200 customers there- maybe 300. There were even more yesterday and the sale continues tomorrow.

Everything in the store (except Ping, but that that's another thread, LOL!) was marked down anywhere from 20%-40% for the sale, plus there was an additional 10% off the lowest marked price.

And people were buying- 2 and 3 deep at all 3 cash registers. But- they had the chance to try any club imaginable on the line with factory reps, get fitted if need be, and then come in and get a sale price. I've been in that store several times in the past month and it's absolutely DEAD normally.

People are watching their pennies, waiting for sales, etc. And the store was absolutely DUMPING inventory (to reduce their floorplan loan I would guess) and I suspect they'll carry a much thinner inventory after this sale is over.

I picked up a couple of used putters at what *I THOUGHT* were fire-sale prices. They had a $280 Odyssey Black Series-i putter that was used but appeared absolutely brand new, with headcover. They had it marked $180 (which seemed like a pretty reasonable price to me) but I took it out on the practice green and fooled around with it for a while. Brought it in and asked "what will you take for this today during the sale?" The guy shrugged and said, "Half what it's marked?) For $90 it was gone before he could finish saying the price!

Picked up a beautiful Ping G2i Sniper mallet for $40 too. It seemed pretty obvious the object was to get merchandise out of the store, ALMOST regardless of price.

These are FASCINATING financial times...

 

[Harry Longshanks]

The guy shrugged and said, "Half what it's marked?) For $90 it was gone before he could finish saying the price!

:shock:

 

[HardcoreLooper]

Pinged, we would love that, but here is my take on it. The debt is too high and it outweighs the assets by a large amount. I would be shocked if someone bought the company as is. As someone that has dealt with buying and selling companies a lot over the past 6 years, this one would be a tough sale unless they can leave the debt behind and just buy the assets. That is a common practice with biz sales obviously, however in this case, that debt would still be owed and I am not sure it could happen.

I had heard the PUMA one for a while now and according to PUMA directly, it is just not the case. However we all know that what they say may not be what actually happens.

JB - You would know better than I on this, but do you think that potential buyers might be waiting for liquidation? Nickent makes gorgeous clubs, but I wonder if their brand is just considered too much of a niche brand to have any goodwill value.

Of course, I would have thought that the Ben Hogan company would have considerable goodwill value, and Callaway has done nothing with it. Which I consider unforgiveable.


Then again, Callaway bought the old Ginty brand (remember them?). Don't know what posessed them to do that.

 

[Floppy]

:shock:

Yet, places around here expect you to pay $200 for a two year old driver.

 

[JB]

JB - You would know better than I on this, but do you think that potential buyers might be waiting for liquidation? Nickent makes gorgeous clubs, but I wonder if their brand is just considered too much of a niche brand to have any goodwill value.

Of course, I would have thought that the Ben Hogan company would have considerable goodwill value, and Callaway has done nothing with it. Which I consider unforgiveable.


Then again, Callaway bought the old Ginty brand (remember them?). Don't know what posessed them to do that.

If that is the case, why buy them at all? If someone is to buy them it is because of their $5 million in inventory. As for Hogan, they have planned to keep it on the shelves for some reason.

 

[HardcoreLooper]

If that is the case, why buy them at all? If someone is to buy them it is because of their $5 million in inventory.

That's what I'm talking about. Are the vultures circling? I sure hope not, but...

As for Hogan, they have planned to keep it on the shelves for some reason.

Yeah, but it looks like it's online only, and they're not designing anything new. Hogan deserves better. Weren't they the first company to sell forged cavity backs? The old Hogan Edges? My dad had a set of those, and I used to steal his long irons when I was having trouble hitting the ball.

 

[JB]

Those are the clubs I got used to playing on. Hogan has been shelved by them and according to their own people, will not design anything new. However the people behind the great Hogan clubs are now at Dimension Z and we have done some stories on them.

 

[Osahar]

Definitely not the kind of news I like to hear, considering how much I've been enjoying my Nickent clubs. Hopefully they can find someone to pick up the pieces and keep the company and designs going if it's as bad as it sounds.

The story almost reminds me of the current Chrysler story. Fiat was talking merger, but it sounds like that's going to fall through. So if/when Chrysler goes into bankruptcy (May 1st should be interesting!) you'll see the vultures circling to pick up the pieces. My best guess - if Fiat can get the financing they'll buy up a portion of Chrysler, and it's dealer network, for a portion of what the merger would have cost them and without the attached legacy debt.