Golden Bear Performs Solidly In Choppy IPO Market >JACK FGCI 08/01/1996 Dow Jones News Service(Copyright (c) 1996, Dow Jones &
Company, Inc.)
NEW YORK (Dow Jones)--Golden Bear Golf Inc. (JACK) teed up a successful initial public offering in a choppy market wracked by postponements
of weaker deals.
'This deal stood on its own,' said Ryan Jacob, research director for IPO Value Monitor in New York.
Analysts said technology stocks must rebound to restore full health to the new-issues market.
Golden Bear Golf is a provider of brand-name golf products and services, including the licensing, ownership and operation of practice and instructional
facilities, the construction and renovation of golf courses, as well as course-design services to third parties. The company's image is wrapped around
legendary pro golfer Jack Nicklaus, known as the 'Golden Bear.'
The company, based in North Palm Beach, Fla., priced 2.16 million shares, up from the originally planned 1.8 million, at $16 through underwriters led
by Merrill Lynch & Co. Price talk had been $14 to $16 a share. The stock opened at 16 1/2, rose to 18 1/4 and was trading at 17 3/4 recently.
'Golden Bear's tempered opening is indicative of the current state of the IPO market,' Jacob said. 'A month or two ago, this would have opened with a
much-higher premium.'
Analysts said the deal appears to be driven by strong retail demand, apparently from individual investors who want a piece of the Nicklaus aura.
'Nicklaus is one of the strongest names in sports and the strongest name in golf,' Jacob said.
Steven Samblis , chief financial strategist for Samblis in Longwood, Fla., said the deal shows that quality offers can be completed in the current market
and companies can raise money. However, current conditions won't produce dazzling aftermarket runs.
'A quality issue, no matter what the industry, will be accepted,' he said.
Investors have shown a fondness for other golf stocks in the past, including Callaway Golf Co. (ELY) of Carlsbad, Calif., a developer of high-quality
clubs. The company priced 2.6 million shares at $20 each in
February 1992 via Merrill Lynch. The 52-week high is 36 5/8 and the stock was trading at 30 1/8 recently.
In December 1993, Coastcast Corp. (PAR) of Rancho Dominguez, Calif., a manufacturer of golf club heads, priced 2 million shares at $16 each via
Bear Stearns & Co. The 52-week high is 27 5/8 and the stock
was trading recently at 20 1/4.
In November 1994, Family Golf Centers Inc. (FGCI) of Melville, N.Y., owner and operator of facilities offering lessons, practice, coaching and a
full-line pro shop, priced 1.2 million shares via Hampshire Securities at $5 each. The 52-week high is 30 1/4 and the stock was recently trading at 23
3/4.
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