Consumer products company Fortune Brands, Inc. (FO) said Wednesday that it has agreed to sell its Cobra golf brand to German sportswear maker Puma AG. Financial terms of the deal were not immediately disclosed.
Deerfield, Illinois-based Fortune Brands said the sale includes the brand, related inventory, intellectual property and endorsement contracts.
Acushnet Co., the golf business of Fortune Brands, will provide transition services to Puma - including production, distribution, field sales and customer service - for an agreed-upon period of time beyond closing of the sale. All Acushnet employees dedicated to the Cobra brand are expected to become employees of Puma after the deal closes.
"Divesting the Cobra brand will enable us to drive shareholder value by concentrating our golf investments behind Titleist and FootJoy, which represent our highest return growth opportunities in golf," said Bruce Carbonari, chairman and chief executive officer of Fortune Brands.
The deal is expected to close early in the second quarter, subject to customary closing conditions and regulatory approvals.
Fortune Brands said it expects the sale to reduce its 2010 earnings by $0.02 per share before a one-time gain on sale of $0.05 per share.
Fortune Brands shares are currently trading at $46.91, up 43 cents.
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