Back in August, we covered the spinoff that wasn’t: Topgolf Callaway Brands (MODG) had delayed plans to spin off its namesake golf entertainment business, and with the CEO stepping down, it didn’t take a PGA Tour psychic to predict that the spinoff might not make it to the first tee.
Now it’s official: the company is selling a 60% stake in Topgolf to private equity firm Leonard Green & Partners in a deal that values the business at $1.1 billion. The announcement came November 18, confirming that the spinoff is off the table and Callaway’s plans are shifting from public-market demerger to private-equity monetization.
The company will receive approximately $770 million in cash proceeds, net of taxes and fees, and will retain a 40% minority interest in Topgolf. The transaction is expected to close in the first half of 2026, subject to customary approvals. The remainder of Callaway’s golf equipment and apparel business will stay public and will switch its ticker to CALY.
While the spin would have offered shareholders direct exposure to the Topgolf brand, this deal gets the company real cash and less market scrutiny. Still, there’s a sense of what might have been — especially for those hoping for a clean Topgolf story in the public markets.
Disclosure: The author holds no position in any stock mentioned.
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Topgolf Callaway (MODG) is finally teeing up a deal — but it’s not the spinoff shareholders were promised.
Just months after delaying the planned spinoff of its Topgolf business, MODG is now going in a different direction: private equity. The company will sell a 60% stake in Topgolf to Leonard Green & Partners for $725 million in cash, valuing the business at $4.2 billion. MODG will retain a 40% stake, while netting approximately $350 million in after-tax proceeds.
The press release announcing the deal lays out the full terms, which include the creation of a new standalone company (still privately held), led by Topgolf CEO Artie Starrs. The transaction is expected to close in early 2024.
This move follows the August delay of the previously announced spinoff, which itself was met with investor skepticism — especially after MODG CEO Chip Brewer abruptly retired. At the time, the company cited market conditions and operational complexity.
That explanation may have masked a deeper truth: perhaps MODG never had strong conviction in a public Topgolf. The brand has high capital intensity, long payback periods, and mixed unit economics. Now, Leonard Green gets to try to unlock value in a private setting.
For MODG shareholders, the shift from spinoff to sale isn’t necessarily bad. The company receives immediate liquidity, offloads majority control of a capex-heavy business, and still maintains upside through its 40% retained stake. And with $350 million in net cash, MODG has dry powder to pay down debt or reinvest in its core golf equipment and apparel operations.
But make no mistake — this isn’t the clean, simple spinoff that was promised. It’s a reset.
Disclosure: The author holds no position in any stock mentioned.