Ingersoll Rand said it will sell its golf cart maker Club Cart to private equity firm Platinum Equity for $1.68 billion in order to reduce its debt, the deal is the latest in an asset sale drive by CEO Vicente Reynal to streamline the company’s portfolio after merging its manufacturing business with Gardner Denver Holdings last year.
As of December 31, Ingersoll Rand has a long-term debt of approximately $3.86 billion, and the proceeds from the transaction will be directed to a portion of it, and Reynal added that the proceeds will also be directed toward the company’s core business.
Other sales are expected to be concluded that will likely pay dividends to shareholders in the long term, but the focus of investors will often shift to reinvesting the proceeds and implementing the company’s inflation strategy and increasing its profit margins.
For Platinum Equity, the deal represents a bet on the revival of golf as a recreational sport after the Corona pandemic, which reduced revenue for the sport by 6% during 2020, and the deal is supposed to close in the third quarter of 2021,
knowing that Goldman Sachs will act as the financial advisor to Ingersoll Rand, while Simpson and Thacher & Bartlett will be its legal advisor.