Editor’s note: This story was updated March 24 with the names of the financial companies working with Stokehouse on the bid for Rip Curl.
Paul Naude and a consortium led by Stokehouse are making a bid to acquire Rip Curl from KMD Brands, according to a report in the Australian Financial Review (AFR) and a KMD statement.
Stokehouse, founded by Naude, is home to newer brands including Vissla, Sisstr and Amuse Society.
SESO verified the news with Naude Monday morning, and KMD put out a statement Tuesday morning in Australia elaborating in detail why it is not in favor of Stokehouse’s efforts to buy Rip Curl.
KMD Brands, which owns the Rip Curl, Kathmandu, and Oboz brands, has been struggling of late. The company’s stock, which is traded on both the Australian and New Zealand stock exchanges, has experienced a significant downward trend over the last year, losing approximately 46% to 50% of its value across both exchanges.
“The surf industry in the last 10 or 12 years has been somewhat rudderless as many of the major brands have been controlled and steered by non-surf-industry-savvy people,” Naude told SESO in an interview Monday afternoon. “The industry has suffered as a whole by there not being a leading company with scale, authenticity and commitment to surf culture. Now that there’s been a significant change in the overall landscape of the industry, I see an opportunity for a lead company with scale to emerge that has a variety of credible authentic brands in their mix.”
“At the same time it’s encouraging to see a group of talented new brands leading the new chapter in the surf industry, and whether a bigger leading company emerges or not, I see that new brand momentum continuing,” he added.
Naude said Stokehouse is working with Australia-based Ellerston Capital and Morgans as financial advisers for the Rip Curl effort.
KMD Believes in Company Turnaround Strategy
KMD Chairman David Kirk said KMD is better off implementing its turnaround strategy rather than selling Rip Curl to Stokehouse.
“The concept proposed by Stokehouse creates no value for shareholders and is challenging from an execution standpoint,” Kirk said in a statement. “In addition, the combination of multiple surf brands that directly compete with each other is not a strategy that has proven effective. Our focus remains on executing the Next Level strategy, which has already gained momentum.”
(Editor’s note: Read the complete KMD statement about why it rejected the Stokehouse bid here.)
KMD confirmed earlier this month that it has engaged Goldman Sachs to assist with its treasury and capital management strategy as it navigates a refinancing of its long-term debt facilities.
At the time, KMD said no decision has been made to pursue any recapitalization initiatives, and no terms of any refinancing have been agreed upon.
Rip Curl is KMD’s Biggest Brand
While KMD has experienced difficult times, Rip Curl remains the largest and top performing brand for the company, with NZ$550.4 million (US$322.8) in annual revenue for the fiscal year ended July 31, 2025.
There are also signs that the company’s turnaround plan is taking hold. Rip Curl reported a 5.6% year-over-year increase in total sales for the August to December 2025 period. Sales grew 4.4% through November and December and Rip Curl same-store sales, including online, increased 1.7% in the 23 weeks ended Jan. 4.
Of the large heritage surf brands – Rip Curl, Quiksilver, Billabong, O’Neill, Volcom and Hurley, Rip Curl is the only one that is not operating under a licensing model.
And that’s where Naude see opportunity.
“There is an opportunity to create the leading pure-play company controlled by experienced management who, most importantly, are committed to surf culture,” Stokehouse said in a statement to AFR.
Also, according to AFR, KMD’s largest shareholder, investment management firm Allan Gray, believes KMD should look at all options and the fund expressed frustration with the pace of the KMD’s turnaround efforts. It also said recapitalizing KMD should be “the last alternative.”
Before founding Stokehouse and the Vissla brand, Naude led the North America business for Billabong for many years. Derek O’Neill, who currently runs the Stokehouse European operation, was CEO of Billabong International when it was a publicly traded company based in Australia.
In his interview with SESO, Naude did not seem thrilled that the negotiations with KMD brands have been made public in the media in part because a deal may not materialize.
