Callaway for sale? – This is what the company says about the rumor

A report in the South Korean newspaper Chosun Daily suggests that one of the leading manufacturers of golf equipment could be up for sale. According to the report, the major shareholders of Topgolf Callaway have instructed a key manager to look into the possibility of spinning off the golf equipment and hardware business to focus solely on the state-of-the-art Topgolf driving ranges. The report states that Callaway would be valued at nearly $3 billion and that a South Korean “strategic investor is reportedly interested in acquiring the company.” To put the reported value in perspective: Korea-based Centroid Investment Partners acquired TaylorMade Golf in 2021 from New York-based KPS Capital Partners for $1.7 billion – a figure that remains the largest acquisition in the history of the golf equipment industry. After the report was published on Wednesday, Topgolf Callaway’s share price rose by more than ten percent.

Callaway denies rumors

When asked by Golf.com, a Callaway representative issued the following statement: “While it is our long-standing practice not to respond to market rumors and speculation, in light of the unusual market activity today and a recent media report in Korea about discussions of a possible sale of the company or its golf equipment business, we confirm that we are not aware of any such discussions. We do not intend to comment further on this matter and we assume no obligation to make any further announcements or disclosures should circumstances change.”

Topgolf Callaway CEO Chip Brewer emphasized that Callaway equipment would remain a big part of the message at Topgolf, particularly the Chrome Tour golf ball. “The business has performed exceptionally well from a brand perspective in 2023,” he said. “Our U.S. dollar market share positioned us as the No. 1 club brand and the No. 2 golf ball brand. In clubs alone, we were No. 1 in total clubs, drivers, fairway woods, hybrids and irons.”

PIF reportedly interested in Callaway

Shortly after the rumor that Callaway was up for sale emerged, wild speculation arose on social networks. Even multiple major winner and LIV golfer Phil Mickelson commented on one of them. Golf journalist Bob Ball published the idea on X (formerly Twitter) that the Saudi Arabian sovereign wealth fund PIF could be interested in a takeover of the manufacturer and explained why he thought this was likely: “The acquisition of Callaway Golf by PIF would create an alliance between LIV Golf, Top Golf and Callaway,” Ball explained. “This would be a direct counter-offensive against the alliance of Tiger Woods, the PGA Tour, TGL, Popstroke and TaylorMade.” The integration of LIV Golf into Top Golf would lead to a wider audience, he explained: “With LIV Golf integrated into every Top Golf, local amateur teams could compete in fun local competitions – league play days with lots of food and free drinks. This would attract a lot of new and younger fans to LIV Golf.”

Finance insiders have known for a while that Callaway Golf is for sale. I think there’s a good chance that PIF might buy it for a couple big reasons.

First, it creates an alliance of LIV Golf, Top Golf, and Callaway. That is a direct counter offense to Tiger’s alliance; the… pic.twitter.com/HsD4FsjmYw — Bob “Golf” Ball (@BobBallPdx) March 21, 2024