Hogan Files Chapter 11

[GolfSpy Barbajo]

This just in -- Fort Worth Star-Telegram is reporting Hogan filed for bankruptcy over the weekend.

 

A source called me just a few minutes ago to give me a heads up - he's a creditor so he's trying to get some of the money he's owed.

 

Here's the newspaper story, filed a little over an hour ago...

 

 Ben Hogan Golf Equipment Co. filed for bankruptcy over the weekend, less than a month after it laid off the bulk of its workforce in Fort Worth.

The Chapter 11 petition, filed with the U.S. Bankruptcy Court in Fort Worth on Saturday, lists both assets and liabilities between $1 million and $10 million. Among its top creditors are Perry Ellis International, which licensed the Hogan name to the company, owed $267,500, and Conti Edgecliff-Sias LLC, its landlord in south Fort Worth, owed $77,256.74.

The Fort Worth maker of premium golf clubs, backed by Corbett Capital in Fort Worth, brought the revered Hogan name back to the marketplace two years ago under the leadership of industry veteran Terry Koehler. The company introduced its first set of irons, the Fort Worth 15, in 2015, and a second set, called PTx, a year ago.

Introduced at a time when the golf business has been in the rough, the new Hogan clubs took the novel approach of numbering irons by loft — anywhere from 20 degrees to 63 — instead of the traditional 2-9 plus wedges.

Last August, Koehler was replaced as president and CEO by Scott White, who previously worked as an executive at both Callaway Golf and TaylorMade. In November, the company said it would add the traditional 2-9 numbers on the hosels of the clubs.

On Jan. 3, about 30 workers were laid off, leaving less than 10 employees at its facility near Interstate 35 and Interstate 20 in south Fort Worth. In a statement at the time, Hogan called the action “re-tooling and right-sizing in an effort to become more nimble and profitable.

Read more here: http://www.star-telegram.com/news/business/article129589759.html#storylink=cpy

 

[JAGolfore]

This is sad, I love the Ft. Worth Hi's.  I know the story is still unfolding, but I was hoping they would pull through.

[jaskanski]

Saddened to hear this, but by the same token not that surprised given the business dealings of the brand over the years. 

[jaskanski]

There must a large amount of stock to dispose?

[numberonecoog]

WHo saw this coming? Oh wait once they laid off all the employees everyone saw it coming. Looks like Ill hea dover to Fort Worth and see whats going ot be sold off 

[numberonecoog]

Who saw this coming? Oh wait once they laid off all the employees everyone saw it coming. Looks like Ill hea dover to Fort Worth and see whats going to be sold off 

[JudgeSmails]

ouch.....is this it or will they be back..I wonder.....never really bought the 'retooling' thing

[PlaidJacket]

I'd imagine the Stock will self-dispose.

[Mike Z]

Who saw this coming? Oh wait once they laid off all the employees everyone saw it coming. Looks like Ill hea dover to Fort Worth and see whats going to be sold off 

The initial filing is for a reorg - so no liquidation as of now.  Could happen if they cannot get a plan approved but it looks like they are at least trying to keep the company operating.  The quirky thing is going to be how the licensing deal works out.

 

I hope they can pull it off.  It will be interesting to see how this unfolds.

[Undershooter]

Well this isn't surprising. It's too bad though bc the clubs were good. 

[hckymeyer]

Just let me know when and where I can get TK wedges at a great price to stock up on.

[null]

Just your basic restructuring. Nothing to see here. Haha

[ole gray]

I really hate to see the old companies I was weaned off of hit the dust.  Maybe they can regroup and come back stronger than ever.

[chisag]

... Once irons breached the $1,000 mark I think making it on a reputation, especially a players iron only which is such a small percentage of the iron market, was just about impossible. Let's be honest, regardless of how much you enjoy the performance of the Hogan irons, they didn't do anything special. Other than those on WRX that at least claim they play MB's, that market segment is so small and there are only so many sales to go around. Mizuno and Titleist already have a loyal MB following and I can't imagine even they sell very many sets in any given year. I thought Hogan had a severe uphill battle from the start. 
 

[jayjay0808]

Sad to see. I thought the products looked amazing, but they were priced right below PXG but then higher than Taylormade. That's a real hard place to make money

[Jmikecpa]

Just your basic restructuring. Nothing to see here. Haha

Actually it really could be as this is the start of the playbook in a no sh!t reorg.  I have done this before and led companies through a BK and they have come out for the better.  There could be an issue with some of the contracts that were negotiated by prior management that this would be the only path that could be used to get relief for the company.  Based on some of the comments that I have read related to the management that brought the name back this would not surprise me.  My impression is that they wanted to be Callaway or TaylorMade from day one in terms of operations and overhead.   

 

My $0.02 is that they will not come out on the other side of this for the better.  The main issue that I see are that the assets and liabilities are in the same buckets which would indicate that management is projecting a downturn in revenue.  The main issue with Hogan in their current form is that they have no real meaningful distribution channel and all sets have to be ordered.  There have been a lot of great products over the years that suffered the same fate. 

[null]

Actually it really could be as this is the start of the playbook in a no sh!t reorg. I have done this before and led companies through a BK and they have come out for the better. There could be an issue with some of the contracts that were negotiated by prior management that this would be the only path that could be used to get relief for the company. Based on some of the comments that I have read related to the management that brought the name back this would not surprise me. My impression is that they wanted to be Callaway or TaylorMade from day one in terms of operations and overhead.

 

My $0.02 is that they will not come out on the other side of this for the better. The main issue that I see are that the assets and liabilities are in the same buckets which would indicate that management is projecting a downturn in revenue. The main issue with Hogan in their current form is that they have no real meaningful distribution channel and all sets have to be ordered. There have been a lot of great products over the years that suffered the same fate.

I agree with everything you said. If this was in a different industry or Hogan had a different market plan I'd agree this would be the start of a rebirth.

 

However everything I've read makes this just another step before they sell off what little assets they have.

[Jiro]

Just your basic restructuring. Nothing to see here. Haha

True. The news is certainly a bummer but this doesn't mean Hogan is getting out of the business necessarily. Might just need to hit the reset button so they can keep going.

 

 

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[revkev]

True. The news is certainly a bummer but this doesn't mean Hogan is getting out of the business necessarily. Might just need to hit the reset button so they can keep going.

 

 

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I would love to see this happen but reality is reality. Nike is gone, rumors are floating about Mizuno. I don't see a place for this brand at this time. That's a shame, I love my SCOR wedges and the day will come when they need to be replaced.

 

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[dru_]

Yeah, it's an 11, so it could go either way. 7 == DONE.  11 == ????  and a lot depends upon the judge.

[Undershooter]

... Once irons breached the $1,000 mark I think making it on a reputation, especially a players iron only which is such a small percentage of the iron market, was just about impossible. Let's be honest, regardless of how much you enjoy the performance of the Hogan irons, they didn't do anything special. Other than those on WRX that at least claim they play MB's, that market segment is so small and there are only so many sales to go around. Mizuno and Titleist already have a loyal MB following and I can't imagine even they sell very many sets in any given year. I thought Hogan had a severe uphill battle from the start. 

 

Hey... MB players are people too 

[Jiro]

I would love to see this happen but reality is reality. Nike is gone, rumors are floating about Mizuno. I don't see a place for this brand at this time. That's a shame, I love my SCOR wedges and the day will come when they need to be replaced.

 

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I play the hogan wedges which are basically the Scor wedges with a little softer metal. I too love these wedges so sad to see if they go under. Maybe if the do Terry Kohler can resurrect the Scor brand

 

 

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[chisag]

Hey... MB players are people too 

 

... I played MB's most of my early golfing life.  There are just so few MB players buying new MB's so I am only talking about supply and demand. A company with a proven track record that offers MB's will probably always offer MB's because as you said, there is a market. It is just a very small percentage of the iron market so not many sales to go around. I have seen newer Mizuno and Titleist MB's in bags but have never seen any of the new Hogans. There are still new Hogan irons and wedges in the Chicago suburban PGA Superstore and the manager told me they never sold a single set, just a few of the wedges when they first came out. 

[EthanSterlingPrice]

Chapter 11 is bankruptcy with the intent of keeping the business alive though so they ain't dead yet. Just on life support, I just hope they can pull it off.

 

 

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[Jmikecpa]

Chapter 11 is bankruptcy with the intent of keeping the business alive though so they ain't dead yet. Just on life support, I just hope they can pull it off.

 

 

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Technically yes......but a lot depends on the creditors committee and as stated above on the judge.  The creditors will need to approve the restructure prior to the judge granting relief through the court.  Once it is filed it is generally a document that the public can request unless the case is sealed by the judge.

[Undershooter]

... I played MB's most of my early golfing life.  There are just so few MB players buying new MB's so I am only talking about supply and demand. A company with a proven track record that offers MB's will probably always offer MB's because as you said, there is a market. It is just a very small percentage of the iron market so not many sales to go around. I have seen newer Mizuno and Titleist MB's in bags but have never seen any of the new Hogans. There are still new Hogan irons and wedges in the Chicago suburban PGA Superstore and the manager told me they never sold a single set, just a few of the wedges when they first came out. 

I was just messing with ya man. I agree that it isn't a very big market. 

[EthanSterlingPrice]

I was just messing with ya man. I agree that it isn't a very big market.

and let's be honest a portion of that market has no business with them lol.

 

 

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[Undershooter]

and let's be honest a portion of that market has no business with them lol.

 

 

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Probably the majority of the market tbh. Myself included. 

[EthanSterlingPrice]

Nike blades were the only ones I ever used but I know I'm better off with my Hogans that's for sure.

 

 

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[Undershooter]

Nike blades were the only ones I ever used but I know I'm better off with my Hogans that's for sure.

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I still have a set of VR pro blades. I love those things to death.