NEW YORK -- Golf Town will buy Golfsmith International Holdings Inc. for about $96.5 million, the Canadian retailer said Monday, more than doubling its store base and significantly expanding its presence in the United States.
Under the terms of the agreement, the Toronto-based company will pay $6.10 per share in cash. The offer represents a 30 percent premium over the Austin, Texas-based company's Friday closing stock price of $4.71.
Shares of Golfsmith spiked 30 percent to hit a four-year high of $6.35. Based on Golfsmith's outstanding shares of approximately 15.8 million, the deal is worth about $96.5 million in all.
The sale, if approved by regulators, is expected to close in the third quarter.
Golf Town is owned by Omers Private Equity and operates 54 stores across Canada and seven stores around the Boston area.
Golfsmith sells equipment, clothing and accessories at 85 stores across the United States, as well as through its website and an assortment of catalogues.
It was not clear Monday under which name the stores included in the deal will operate. However, some published reports indicated that Golfsmith CEO Marty Hanaka will serve as the CEO of the combined companies, with Golfsmith President and COO Sue Gove becoming president and Golf Town interim CEO Ron Hornbaker becoming executive vice president.
The boards of both companies have approved the sale, along with key Golfsmith shareholders that collectively hold the majority of its shares. As a result, the deal is not subject to further shareholder approval, the companies said.