National Golf Holder Seeks to Block Merger
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National Golf Properties Inc.’s largest outside shareholder urged the company to abandon a plan to merge with American Golf Corp., a related company that operates the golf course owner’s properties.
In a letter to the Santa Monica-based company’s board, Cliffwood Partners offered an alternative proposal that would have National Golf find other managers to replace American Golf.
A decline in American Golf’s business has kept it from making rent payments and triggered a default on both companies’ debt. American Golf leases 133 of National Golf’s 137 courses.
“The proposed merger would permanently bind the company to its problematic operator, which would only compound the issues that led to the company’s current state of disarray,” Cliffwood wrote in his letter dated March 19. Cliffwood, based in Los Angeles, holds a 9% stake in National Golf.
Charles Paul, National Golf’s interim chief executive, said the company is committed to the merger. Terms of the deal, announced last month, haven’t been disclosed.
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