Meadowbrook Golf Group Inc. has failed to follow through on its deal to buy five Tournament Players Club courses for $40 million, a PGA Tour spokesman said.
The letter of intent and one extension expired in fall 2004, according to Chris Smith, the Tour’s director of public relations.
“It’s off the table,” Smith said.
Tour officials declined to explain why the deal unraveled, and Meadowbrook executives did not respond to repeated requests for comment.
But it was clear the Tour was moving on, with officials saying there were no current talks with Meadowbrook, and that they already were entertaining offers from new suitors.
The Orlando, Fla.-based course owner and operator had coveted five of the 30 courses that comprise the Tour’s TPC Network: TPC at Eagle Trace and TPC at Heron Bay, both in Coral Springs, Fla.; TPC of Tampa Bay in Lutz, Fla.; TPC of Myrtle Beach in Murrells Inlet, S.C.; and TPC of Virginia Beach (Golfweek, March 6, 2004).
Meadowbrook and its primary financial partner, Apollo Real Estate Advisors of New York, sought the courses to add high-end properties to their portfolio. They had created the Medallion Golf division, which was slated to operate the TPC courses and keep them within the TPC Network via a licensing agreement with the Tour.
According to the TPC Network’s consolidated financial statements from 2003, “net revenues” from all of its courses combined was $8.1 million, down 23 percent from $10.5 million in 2002. This follows a 13.4 percent decline from $12.1 million in 2001. (The Tour defines net revenues as revenues minus expenses.)
Meadowbrook owns, leases, manages or maintains approximately 75 properties. In September 2002, it started Honors Fund LLC, a planned $150 million kitty for equity and debt investments. Apollo contributed $25 million to capitalize this fund, and Meadowbrook later announced it had raised an additional $50 million.
This money was to be available essentially for buying golf courses. In 2002, Meadowbrook hired Don Rhodes, a golf industry veteran in finance and acquisition, to spearhead its search for new properties. Rhodes left Meadowbrook in November, not long after the letter of intent for the TPC courses expired.
– Paul Hughes is a senior writer for Golfweek’s sister publication, SuperNews.