Falconhead-Backed GPS Industries Merges With Prolink

Falconhead-Backed GPS Industries Merges With Prolink
By Sabrina Willmer for LBO Wire

10/19/2009 – Falconhead Capital LLC-backed GPS Industries has merged with fellow golf technology company ProLink Systems Inc. as well as sixty golf courses. The courses were owned by David Chessler, who was chief executive of GPS, and now has that post with the newly formed company GPSI Holdings LLC.

GPSI provides golf cart-mounted GPS displays. The products offer information like distance measurement and provide strategic playing tips, and include advertising messages targeted to golfers. 

Last month, Falconhead won a bankruptcy auction for the assets of GPS Industries, which filed for Chapter 11 in July. Its bid was worth $5 million, plus up to $735,000 more, depending on a court decision on a patent value. 

The firm teamed up on a financing plan with golfer Greg Norman, whose Great White Shark Enterprises was a senior noteholder in GPS Industries. Under the company's restructuring plan, noteholders converted debt to equity.

Norman serves on Falconhead's advisory board. He will own a significant equity stake in GPSI and has entered an agreement to promote GPSI's business, according to a press release.

GPS Industries and ProLink were at odds in a patent dispute as recently as March.

New York-based Falconhead invests in the consumer, leisure/lifestyle and media sectors.

David Moross, chairman and chief executive of Falconhead, said GPS Industries and ProLink were the two primary players that dominated the industry so that presented an interesting merger opportunity. The firm owns 70% of GPSI. 

The merger has resulted in a company that provides golf cart-mounted GPS systems on about 1,000 courses in both North America and Europe. GPSI Holdings plans to expands its non-U.S. business into Asia through acquiring courses, said Moross.

GPSI formed an exclusive partnership with golf car manufacturer Club Car, which will give GPSI access to the company's sales force. Subsequently, this will increase the sales team from 8 to 120. 

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