DBRS lowers Golf Town on bankruptcy filing

DBRS said it downgraded the issuer rating and senior secured second-lien notes rating of Golf Town Canada Inc. and Golfsmith International Holdings, Inc. to D and removed the ratings from under review with negative implications.

The agency also said it discontinued and withdrew the recovery rating on the company’s senior secured second-lien notes.

The downgrades follow news that the company began creditor-protection proceedings in the Ontario Superior Court of Justice and a Ch. 11 case in the United States Bankruptcy Court for the District of Delaware, DBRS said.

The company also entered into a definitive asset purchase agreement for the sale of the Canada-based business of Golf Town Canada Inc. to an entity to be controlled by a purchaser group led by Fairfax Financial Holdings Ltd. and certain investment funds managed by Signature Global Asset Management, a division of CI Investments Inc., the agency said.

The company also announced that it entered into a support agreement with Fairfax and CI with respect to a recapitalization and restructuring transaction of the U.S.-based business of Golfsmith International Holdings, Inc., DBRS said.

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