Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Equity Bottom-Up

<ul><li>Our sum-of-the parts valuation scenarios analysis suggests a range of 24% to 70% upside for Fila Korea shares, depending upon different values scenarios for Acushnet IPO.</li><li>Acushnet generated EBITDA of $185 million in 2014. Our base case scenario assumes EBITDA of $200 million in 2016 for Acushnet. </li><li>Callaway Golf is the closest comp to Acushnet. Callaway Golf's shares have been trading at about 12x EV/EBITDA based on 2015 estimates. One could argue that Acushnet should be priced at least 12x EV/EBITDA multiple. Our base case scenario assumes 12x EV/EBITDA for Acushnet IPO, although we believe it could be priced higher in the 13-14x range.</li><li>Fila Korea currently owns a 55.8% stake of Acushnet. Post IPO, Fila Korea will own a 33% stake of Acushnet.</li><li>Acushnet has the best brands in the global golfing industry through its Titleist and Footjoy names.</li><li>Acushnet is getting ready for a IPO in 2016, most likely to be listed in the US.</li></ul>

Our sum-of-the parts valuation scenarios analysis suggests a range of 24% to 70% upside for Fila Korea shares, depending upon different values scenarios for Acushnet IPO.Acushnet generated EBITDA of $185 million in 2014. Our base case scenario assumes EBITDA of $200 million in 2016 for Acushnet. Callaway Golf is the closest comp to Acushnet. Callaway Golf's shares have been trading at about 12x EV/EBITDA based on 2015 estimates. One could argue that Acushnet should be priced at least 12x EV/EBITDA multiple. Our base case scenario assumes 12x EV/EBITDA for Acushnet IPO, although we believe it could be priced higher in the 13-14x range.Fila Korea currently owns a 55.8% stake of Acushnet. Post IPO, Fila Korea will own a 33% stake of Acushnet.Acushnet has the best brands in the global golfing industry through its Titleist and Footjoy names.Acushnet is getting ready for a IPO in 2016, most likely to be listed in the US.

Fila Korea - IPO of Acushnet Is the Tipping Point of Value Realization

United States

Topgolf Callaway Brands Corp. provides golf equipment. The Company offers balls, gear, customs, fittings, and apparels. Topgolf Callaway Brands serves customers worldwide.

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Topgolf Callaway Brands (MODG US)

Fila Korea - IPO of Acushnet Is the Tipping Point of Value Realization

Our sum-of-the parts valuation scenarios analysis suggests a range of 24% to 70% upside for Fila Korea shares, depending upon different values...

Douglas Kim

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