Last week's announcement that Callaway Golf intends to buy Top-Flite Golf's major assets — which include the Top-Flite, Strata and Ben Hogan brands — for $125 million was hailed by many observers as a smart marriage. Callaway would be getting the efficient golf-ball manufacturing business it has failed to develop, and debt-riddled Top-Flite would ensure that 95 percent of its employees would keep their jobs at its Massachusetts headquarters while the vast majority of its athlete endorsers would keep their deals.
Numerous matters are unresolved, however, including the purchase itself. As part of an accelerated bankruptcy procedure, other interested parties can attempt to outbid Callaway after roughly 60 days, with Callaway having one chance to counterbid.
A source at one Callaway competitor said that company is interested in pursuing Top-Flite. Top-Flite CEO Jim Craigie said Callaway's $125 million bid was the only formal bid Top-Flite had received over the past year, although it had "very extensive talks" with several companies.
If the deal is completed, Callaway would become the No. 2 ball company behind Titleist.
Craigie said only a small number of its athlete endorsers would not be retained by Callaway, but he would not reveal who would be dropped. Top-Flite's endorsers include Justin Leonard, Hal Sutton and U.S. Open champion Jim Furyk for its higher-end Hogan brand, with Lee Trevino endorsing the Top-Flite brand. Craigie put Top-Flite's endorsement spending at roughly $10 million a year, or 4 percent to 5 percent of its $200 million to $250 million in revenue.
Craigie would not say what his own plans are beyond completing the deal, or whether he expects a position with Callaway.
