Nike and Converse on the Same Team

The basketball sneakers worn by Larry Bird and Michael Jordan will find themselves on the same team after Nike Inc. has agreed to acquire Converse Inc. of North Andover. Nike valued the deal at $305 million, saying it consisted of an undisclosed amount of cash as well as the assumption of debt.

Founded in 1908, Converse's simple canvas high-tops became one of the most storied athletic products and were worn by everyone from the fashionable 'it' crowd to city business types. Things changed in the 1980s, however, as the company failed to keep up with the emergence of Nike's new shoe technologies, not to mention the marketing machine it developed.

The new deal should help spread Nike's assets into new markets. Converse's shoes sell for an average of GBP 35a pair, half of Nike's average price, and retail analysts expect the deal will give Nike access to discount channels and perhaps to Foot Locker, the retailer that dropped many of Nike's more expensive shoes last year.

''Converse's management has done an excellent job of re-establishing this beloved brand with consumers and we look forward to supporting them as they continue to implement their growth strategy,'' Tom Clarke, Nike president of new ventures, said in a press release.

The ''retro'' look of many of Converse's shoes have proved a popular fashion, helping the company grow revenue to $205 million in 2002, up from $149 million in 2001, according to a company filing with the Securities and Exchange Commission. Converse had a profit of $18.5 million last year, up from $5.7 million in 2001.