By  on August 8, 2005

NEW YORK — Nike could be interested in making a play for Callaway Golf Co. — but it's not the only company interested.

Industry speculation about Nike buying Callaway heated up last week. "We won't comment on any acquisitions," a Nike spokeswoman said. She declined to comment about whether Nike had been in talks with Callaway, a $900 million Carlsbad, Calif.-based company that owns Callaway Golf, Odyssey, Top-Flite and Ben Hogan.

According to published reports Friday, two Boston buyout firms, Bain Capital LLC and Thomas Lee Partners, have also shown interest. Spokesmen for Bain and Thomas Lee declined comment. In May, Thomas Lee Partners teamed up with Fidelity National Financial to submit an unsolicited bid, according to The Los Angeles Times. FNC chairman and chief executive officer William Foley 2nd did not return a phone call Friday.

Brad Holiday, chief financial officer for Callaway, declined to comment about an acquisition.

He did confirm that in June Callaway said it "received a mild inquiry and the company is exploring all strategic opportunities." At last month's annual shareholders' meeting, the company acknowledged it has hired Lazard Ltd. to explore its options.

In terms of Nike's interest, one senior athletic industry executive, who asked not to be identified, said Nike has had Callaway on its radar for six months or more, but "the price was fluctuating."

"They missed out on The North Face a long time ago. It was dangled in front of them and they let it go because of ACG [the brand's label aimed at outdoor enthusiasts]. The North Face [business] has continued to grow," he said. North Face is now owned by VF Corp.

Buying Callaway would fit in with Nike's strategy to acquire ancillary businesses as it has with Cole Haan, Converse, Starter and Bauer. "It makes total sense, but Nike said in its last [earnings] call that it is not in an acquisition mode," he said.

With Callaway under its umbrella, Nike, which sponsors Tiger Woods, would be in a better position to square off against Greg Norman, the Reebok-owned golf label named after the pro golfer. According to sources, the brand's namesake was said to be blindsided by last week's Adidas-Reebok news and was peeved Reebok honcho Paul Fireman had not kept him in the loop.

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