Quiksilver eyes private deal
In a surprise move, Quiksilver International is expected to emerge from US Chapter 11 bankruptcy protection later this week if a court approves a new financing deal.
The deal, worth $US600 million, would see private equity firm Oaktree Capital gain control of more than 90 per cent of Quiksilver's shares, making the US-listed company privately held.
Curiously, the deal would bring Quiksilver and Billabong, past competitors in the surf industry, into close alignment. Along with their 90 per cent share in Quiksilver, Oaktree currently owns 18.7 per cent of Billabong International, making them the largest shareholder.
There have been rumours of a merger between the two companies. Last September, a US court was told that Oaktree may consider combining Quiksilver with Billabong "at some point".
Quiksilver's European and Asia-Pacific operations, including Australia, are independent of Quiksilver International and not part of the bankruptcy filing.
The US Bankruptcy Court is expected to rule on the proposal at a hearing on Thursday.
Comments
Only a stoner knows the feeling of a few Quik-Bongs before a surf
It sounds good but has anyone an idea of what this might mean in the wash up? They'll obviously no longer be beholden to shareholders but I imagine Oaktree Capital are full of suits not surfers, so will they still bankroll the 'core' contests: Snapper Rocks, France, The Eddie Aikau etc.?
Private ownership sounds about right since no-one in their right mind would buy their shares as a long term investment.
The corporate world is crazy (stating the obvious). A listed company goes belly up, shareholders (including the average punter) kicked out into the streets, rich people move in to buy for a nickel and dime. I love this Capitalism, so deranged. I always visualise a bunch of google-eyed salivating cookie monsters going mental over crumbs and cookie shit that has been reconstituted over and over.
I can't imagine that Oaktree feel any compulsion to continue the direction that QS have gone down whether that involves surf comps or team riders or whatever. But private equity is always looking for a quick buck and won't want to be owners for more than 3 to 5 years. So it may well end up public again in the future while Oaktree cash up to more gullible share buyers. The big question to me would be what they are going to do with Quik in the meantime to make it profitable fast. They certainly won't be doing any long term brand building! Remember the Dick Smith debacle!
This is what will happen. Oaktree will take Quik to Wallmart, Macy's and other non surf retailers and get sales up and then flog it back on the stockmarket to make a handsome profit. The move by Oaktree is one that will make them 1 billion in a few years easily. The end result will be the brand has great sales but it will not be a surf brand. Bob Mcknight hang your head in shame for what you have done to the company. A good read is the below link which was published a few days ago in the US
http://www.ocweekly.com/news/how-quiksilver-lost-its-soul-and-ended-up-i...
Yes indeed '71, however sooner than you may think... Quik is already well stocked by the Macy store chain!
Could have all been avoided if they would have spun off Eurozone & Australasia as listed entities in their respective territories, and used the proceeds to wipe the Rossignol debt.
But the greedy yanks didn't want to give up their pie., they'd rather sunk the fucka, which is what happened.
Well the US Bankruptcy Court gave the tick of approval to Quik overnight. By Feb 8 they should be out of Chapter 11 bankruptcy.
"Today marks a new beginning for Quiksilver, Roxy, and DC Shoes," said Chief Exec Pierre Agnes.
"We will emerge as a revitalised and stronger company with experienced leadership, rationalised operations, a clean balance sheet and a world-class partner in Oaktree, who brings additional strategic and operational expertise to our company."
Now that Oaktree are steering the ship it'll be interesting to see what direction they take it (supermarkets or core stores?) and how closely they align with Billabong.
Yes, this will be interesting. Given how they got to where they were, I would be surprised if Oaktree force either / both Quik and BillB to go into mainstream department stores - certain death, me thinks. But usually investors (like Oaktree) see synergies between the various brands then cut up each one up. Essentially , the sum of the parts is greater than the whole. Lets see over the next six months or so.
And.. will they still sponsor WSL events? And field a team of pro surfers?
"Quiksilver will offer hair cuts, beard trims and live music alongside its more traditional surf and skate gear as part of a long-term turnaround plan under new private equity owners."
Direct quote from the SMH, I shit you not.
http://www.smh.com.au/business/retail/quiksilvers-us600-mln-refinancing-...
And there's more:
"Quiksilver also plans to roll out a new retail format called Boardriders after successfully testing the concept with a handful of stores in Australia, Japan, Europe and Russia.
Boardriders stores are around 750 square metres – three times the size of Quiksilver's average store – and have barber shops, live music and hardgoods such as surfboards, skateboards and snowboards as well as Quiksilver's full range of apparel and footwear brands.
"The footprint enables us to tell the full story behind the brand," said Mr Healy. "We have two successful shops open in Australia and we are looking to roll out that footprint where appropriate."
How do beard trims “tell the story behind the brand”?
You have to love that don't you! Just when you think they have sucked the damn thing dry and hung a logo on every possible piece of consumer junk, just when you think that they could not possibly debase the image of surfing any further, they demonstrate the paucity of our imaginations by sucking even harder.
lovely bit of wordsmithing there blind one. Paucity....so good, that last phrase has teeth.
One is at cooly, where is the other?
Great spot for a haircut ...
Torquay has a shiny new Boardriders store too. They have a shrine to the Torquay Boardriders near the bar which is a nice local touch, but its still an overpriced surf store.
The bar has an open deck and isn't a bad place to have a frosty when the sun's out.
...but what about the haircuts Average? It's all about the haircut!
"If you can't cut and trim, don't fucken come!"