Nike Inc. "is stickhandling into the fast-growing ice and
roller hockey market" by proposing to take over Canstar Sports
Inc. of Montreal for US$395M in cash -- "its biggest acquisition
to date." Observers said the deal gives Canstar access to Nike's
"considerable marketing expertise and financial resources,"
allowing Canstar to "accelerate its growth" in the U.S. market.
Canstar manufactures and distributes ice skates and hockey
equipment under the Bauer, Micron, Mega, Daoust, Lange, Cooper
and Flak names, and in-line roller skates and protective gear
under the Bauer label. Canstar's U.S. sales rose 31% in '93 and
the company expects a 77% increase in '94. Execs from both
companies "lauded the deal" (Heinzl & Gibbon, Toronto GLOBE &
MAIL, 12/15). Nike expects the deal to be tendered December 23
with the transaction completed 60-90 days after that. In
Montreal, Francois Shalom notes that Nike's ad budget is "nearly
as much as Canstar's annual sales" (Montreal GAZETTE, 12/15).
Kemper Securities analyst Kevin Dukesherer said the deal "looks
like a very good move for both companies" (N.Y. TIMES, 12/15).
Nike Chair Philip Knight: "Canstar's dominance in the elite ice
skate market is unsurpassed, with more than 70% of NHL players
wearing Canstar branded skates. ... We plan to have Canstar
continue to operate as an autonomous organization without any
change to its structure, operations, management or personnel."
Canstar's Icaro Olivieri: "The joining of these two great
companies represents one of the most strategic moves in the
sporting goods industry" (Nike). Knight and Olivieri will serve
as co-chairs of Canstar for at least three years (Mult., 12/15).
Nike's stock rose two points closing at 68, while Canstar's stock
rose 6 1/8 closing at 19.
NEW ENDORSER: Eric Lindros, who wears Bauer skates, now
joins the lineup of Nike endorsers (USA TODAY, 12/15).
