Plan would bring LV golf retailer out of bankruptcy

Grace Leong

Friday, July 2, 1999 | 11:58 a.m.

Nevada Bob's Canada Inc. plans to buy Nevada Bob's Pro Shop Inc. and bring the Las Vegas company out of bankruptcy.

Nevada Bob's Canada, which is listed on the Toronto Stock Exchange, said Thursday it has proposed to buy a controlling interest in the company for stock from Texas-based GDH International Inc., which acquired the Nevada Bob's Pro Shop chain in March.

More closures of Nevada Bob's Pro Shops may be in the cards once the acquisition is complete, said Tom Russell, Nevada Bob's Pro Shops' president.

"We don't rule out the possibility that a small number of stores may be closed if the location is poor, future prospects are poor and we can't turn it around to make money," added Lyle Edwards, Nevada Bob's Canada president and chief executive.

Nevada Bob's Pro Shops, which filed for Chapter 11 bankruptcy in early March, owes about $50 million to creditors, and has closed 16 of its 58 corporate stores nationwide in recent months. The golf retailer has 120 franchise stores in the United States, including one in Reno; and one corporate store in Las Vegas.

Nevada Bob's Pro Shop will address the merger agreement in its proposed reorganization plan to be filed in bankruptcy court. The parties Thursday declined to disclose the value of the deal and couldn't say how much money would be paid to creditors if the transaction is approved.

The closing of the transaction is subject to shareholder approval as well as the approval of the bankruptcy court and regulatory authorities, including the Toronto Stock Exchange.

The transaction is aimed at transforming Nevada Bob's Canada into a worldwide integrated golf company and giving it ownership of the world wide rights to the "Nevada Bob's" name and franchise operations. Nevada Bob's Canada, the master franchisee of Nevada Bob's Pro Shops, will add Tourshot, Magnesport and Alien Sport brands of golf accessories and balls to its product line.

Under the agreement, the current management team of Nevada Bob's Canada would retain primary management responsibility for the merged company. Edwards and Martin Bunting, executive vice president of Nevada Bob's Canada, would continue in their current roles.