Stories in both the national newspapers today about ClubLink, and its stock consolidation under the ownership of real estate baron Rai Sahi.
Here’s the take from the Financial Post:
Mr. Sahi’s Tri-White Corp. said it is buying out the golf company’s other major shareholders. The move will give Tri-White 70.7% control of ClubLink.
“I would describe Rai Sahi as a very methodical, patient longterm investor. Look at this investment. When he made it, the stock was worth half of what it is worth today,” said one analyst, who did not want his name used.
Mr. Sahi is paying $13.25 per share, or almost $88-million, to buy about 6.6 million shares from a group that represents the interests of former chief executive Robert Poile, Paul Atkinson, a subsidiary of Southwest Sun, Keofferam Limited Partnership and two numbered companies. Most of Mr. Sahi’s original stock was acquired at less than $7 per share.
So what does this mean for ClubLink members? Now that’s the question. Sahi likes to play golf — he’s a member at Mississaugua G&CC — but he’s also a very astute, aggressive businessman. Here’s what Sahi had to say regarding the future of ClubLink:
He said his long-term goal for ClubLink is to look for some real estate development possibilities on ClubLink’s courses.
“We are looking for expansion opportunities,” he said.
It’ll be interesting to see if he meant “around” ClubLink courses and not “on” them….
Bob Weeks at Score Golf is reporting esteemed Hamilton G & CC pro Rob McDannold will be departing the club at the end of this season. I would have expected that McDannold, who has been with the club since the late 1980s, would have finished his career there. Apparently not.
Interesting to see Eagles Nest — likely my favourite golf course in the city — has instituted a weekend twilight rate for the first time in the club’s history. For those that have long found it too expensive, you can now play after noon until May 15 for $115, and then after 2:30 for the same rate throughout the summer. Eagles Nest is my favourite new modern design in Canada — so try it out and let me know what you think.
Speculation continues about the sale of Mystic GC. I haven’t heard anything definitive, but talk is that a group of golfers from Glendale GC have picked up the course. My sources say this isn’t the case, and it was my understanding there was an extension on offers until the middle of May.
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If Mr. Sahi had the intention of ripping up the golf courses to dev. them as real estate, wouldn’t the board of gov. put a stop to it, or try? I have a hard time believing he would destroy golf courses and show no respect for all the membership. Isn’t there a huge tax hit if you rezone a golf course to real estate land? I can understand him wanting to dev. around the courses, but you have to be crazy in love with greed to think of tearing up your membership.
The directors of ClubLink have a fiduciary duty to the corporation, not to the members of the golf clubs. If it was in the coporation’s best interest to rip up the courses and build homes then they should do so. But you can argue that shutting down golf courses would royally tick off the members and would make it harder to sell new memberships which is the business that they are currently in.
Some municipalities defer some or all of the property taxes on a golf club but these become payable if and when the club is sold. This is the case in the city of Toronto. But ClubLink does not have any courses in the city of Toronto, and thier courses are relatively new so their tax hit would be much less than clubs such as Rosedale, St. Georges, etc. that have been around for a long time – I belive this tax liability dates back to the 1950s.