Callaway Buys Topgolf In All-Stock Deal

Thanks to reader for Cara Lombardo’s Wall Street Journal story breaking the shocking news: Callaway is buying the remainder of Topgolf after owning 14%. The all-stock deal marks a stunning turn of events after Topgolf had long eyed an IPO. However the company has seen its business decline during the pandemic with struggles ahead due to issues with public gathering places.

“Topgolf is the best thing that happened to golf since Tiger Woods,” Callaway Chief Executive Chip Brewer said in an interview. “It’s going to be the largest source of new golfers for our industry.”

That was certainly a 2019 view of Topgolf but I’m not sure that’s still the case.

This statement from Lombardo is also strange:

Topgolf’s outdoor driving ranges have been a big draw during the coronavirus pandemic as people look for ways to safely socialize out of the home.

Calling them “outdoor” is partially accurate but I’m not sure about the statement that they are safer places to socialize than, say, a golf course. Or a park.

That said, this seems like a steal for Callaway and CEO Brewer given several factors: Topgolf’s popularity, the likelihood of the facilities bouncing back in better times, and the ability to introduce new golfers to Callaway clubs.