Golf company CFO eyes private infusion.

Tom Severson, a former public company CFO, has a bird's eye view of the private equity market. He's now the CFO of the newly constituted Nicklaus Companies LLC, the enterprise run by famed golfer Jack Nicklaus, which this summer received a $145 million investment from real estate mogul Howard Milstein through his New York Private Bank and Trust.

Severson says the middle-market private company, based in North Palm Beach, Fla., and known until the transaction as Golden Bear International, looked long and hard at various financing options before settling on the Milstein family, a noted developer of New York real estate.

"There are financial goals as well as strategic goals, and we needed a good partner" that could help grow the business beyond the immediate influence and lifetime of 67-year-old Jack Nicklaus himself, Severson said in an interview.

The finance chief says the investment process involved the hiring of PGP Capital, a boutique investment banking firm that is well-connected in Asia. Severson, who had worked with PGP years earlier, said the Nicklaus company needed to leverage outside investment banking work and felt that a major investment bank "might not have the patience" for that.

Golden Bear drew "a lot of interest from private equity and strategic partners," he adds, and there were "extensive negotiations over what kind of financial structure and style of people" would be brought in. The Milstein group, he says, "was very consistent, very professional. It's a family business with a long-term view of creating value."

"Most private equity firms like to throw in a slug of real bank debt, or they want some kind of preferred stock issue or warrants--that didn't make sense in this case," he adds. "We're truly partners. If we hit a few bumps--and this is the kind of business that has a few bumps--this is the kind of partner who can help you work through things."

[ILLUSTRATION OMITTED]

Severson notes that Golden Bear had a small bank revolving loan but really no debt to speak of, and the company has been generating good cash flow. More than half of that has been coming from Nicklaus Design, which designs golf courses, followed by the other two operating units, Nicklaus Marketing, which handles licensing of the Nicklaus name and has apparel sales of $180 million worldwide, and Nicklaus Golf Equipment.

International growth is a key goal. "We've really seen a shift in the last few years to international side of the business," Severson says. Currently, he adds, about two-thirds of the business is coming from abroad, where the company is building golf courses in places like Russia, Kazakhstan, Vietnam, South Korea, Chile, Panama, Mexico and the Dominican Republic.