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Veteran clubmaker Honma Golf swings for higher apparel sales

Investment from Itochu and CP Group seen aiding procurement, overseas expansion

Honma Golf's Liu Jianguo, second from left, and Itochu's Masahiro Morofuji, second from right, announce their partnership in Hong Kong on Monday.

HONG KONG -- Honma Golf aims to roughly triple its proportion of sales coming from golf apparel and other equipment beyond the company's mainstay and well-regarded clubs, with help from soon-to-be stakeholders including Japanese trading house Itochu.

Itochu and Thai conglomerate Charoen Pokphand Group are set to invest about 834 million Hong Kong dollars ($106 million) in Honma, the Hong Kong-listed company said Monday. CP Group will acquire 10% of the company, while Itochu takes 6.29%. Liu Jianguo, who is a representative director of Honma and owns its controlling shareholder Kouunn Holdings, will retain management rights with a 53% stake.

Honma will launch new products beginning with its lineup for spring and summer 2019. The company looks to use Itochu's networks in textiles to boost sales of products such as golf apparel, shoes and bags to about 40% of Honma's total, up from the most recent count of 13%. The industry average is about 60%.

Liu wants to capitalize on Honma's reputation as a premium brand and pursue high-performance apparel, he told The Nikkei. He described Itochu's strengths in the field as attractive.

Masahiro Morofuji, a managing executive officer at Itochu, cited CP Group's vast network in Asia and voiced expectations that the Thai company could offer support in overseas expansion such as by providing connections to clients.

Japan-based Honma filed for bankruptcy protection in 2005 after excessive investment in golf courses put it in a bind. The company's acquisition by Liu in 2010 led to a revamped business model, bringing changes including selling its products via volume retailers rather than only through directly managed shops.

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