With the acquisition, SurfStitch consolidates its global reach as the major player in online action sports retail.
Quiksilver confirmed the purchase Tuesday, and said it will receive $16 million in net proceeds from the sale. Australian media erroneously reported Monday that SurfStitch bought Quiksilver’s share of Surfdome for $45 million.
Surfdome generated sales of $60 million in the past 12 months, according to Quiksilver.
As part of the transaction, Surfdome has agreed to sell Quiksilver, Roxy and DC products for two years.
In a statement, Quiksilver CEO Andy Mooney said the sale of Surfdome completes Quiksilver’s sale of non-strategic assets, including Mervin Manufacturing, Hawk Designs, VSTR, Summer Teeth and Moskova.
Below are the official press releases from SurfStitch and Quiksilver.
Press Release:
SurfStitch Group Acquisition of Europe’s Leading Online Action Sports Store “Surfdome”
SurfStitch Group, The World’s leading Online Action Sports Store, is excited to announce that it has entered into an agreement to acquire Europe’s leading online action sports retailer Surfdome. Surfdome, established in London, UK in 2006 by founder Justin Stone, has grown significantly since inception to offer consumers over 30,000 styles from 900 brands to 125 + countries.
Surfdome will complement SurfStitch’s existing fast growing European operations. Justin Cameron, SurfStitch Group CEO commented: “We are excited to welcome Justin and the Surfdome team into the SurfStitch Group. Having watched the successful growth of the Surfdome business in the UK and broader European market with interest since our launch in Europe, we always viewed an opportunity to combine our businesses and leverage the strong operational synergies that exist”.
With SurfStitch’s leading positions in the French, Spanish and Italian markets and Surfdome’s dominant positions in UK, Germany and Nordic countries, the combined European operations provide the Group an opportunity to further expand in greater Europe. And with growth rates in the last 12 months of over 50% for the combined European operations, momentum is building quickly.
The combined SurfStitch Group, with operations in Australia, France, UK and USA is the global leader in Online Action Sports. With over 2.5 million customers on its combined database of 15-25 year olds, 500,000+ daily visits and over 900 Brands, SurfStitch continues to challenge the incumbent bricks and mortar retailers.
The acquisition of Surfdome will see Justin Stone take the position of Managing Director SurfStitch Group Europe, and take a Director’s position on the Board of SurfStitch Group. This follows the recent appointments of Howard McDonald (ex Myer Group Chairman, CEO Just Group), and Stephen Goddard (ex David Jones CFO) as Chairman and Non Executive Directors respectively of the SurfStitch Group.
About SurfStitch Group
SurfStitch Group founded by Justin Cameron and Lex Pedersen in Sydney’s (Australia) Northern Beaches in 2007, has grown to become the world’s largest online action sports retailer. Operating under the SurfStitch (www.surfstitch.com), Swell (www.swell.com) and Surfdome (www.surfdome.com) banners, SurfStitch Group employs over 500 staff globally, working with 900+ of the world’s leading action sports and fashion brands.
SurfStitch currently offers next day delivery to nearly 100 countries with warehouse operations in Australia, France, UK and the USA and is looking to expand this to over 150 countries in 2015.
See Page 2 for the Quiksilver press release
Press Release:
Quiksilver Reaches Agreement to Sell Surfdome to SurfStitch Group
HUNTINGTON BEACH, Calif. & SYDNEY–(BUSINESS WIRE)– Quiksilver, Inc. (NYSE: ZQK) and SurfStitch Group today announced that they have reached a definitive agreement for the sale of Quiksilver’s majority ownership interest in Surfdome, an online retailer of action sports products, to SurfStitch, an Australian based online retailer of action sports products.
Quiksilver expects to receive net proceeds of approximately (US)$16 million for its equity interest, loans and other amounts due from Surfdome. The all-cash transaction, which is subject to SurfStitch reaching agreement to purchase the minority interest in Surfdome, is expected to close before the end of the current calendar year.
As part of the transaction, Surfdome will continue to carry Quiksilver, Roxy and DC products under a two-year supply agreement.
“Our business with Surfstitch has been growing, and we view both Surfdome and Surfstitch as key retail partners,” said Andy Mooney, chairman and chief executive officer of Quiksilver, Inc. “The sale of Surfdome is in keeping with our strategy to focus on our core Quiksilver, Roxy and DC brands. Moreover, this will complete our planned exits from non-strategic businesses, which have included Mervin Manufacturing, Hawk Designs, VSTR, Summer Teeth and Moskova.”
Justin Cameron, SurfStitch Group chief executive officer, said, “We are excited to welcome the Surfdome team into the SurfStitch Group. Having watched the successful growth of Surfdome’s business in the UK and broader European market with interest since our launch in Europe, we always hoped to find an opportunity to combine our businesses and leverage the strong operational synergies that exist.”
Surfdome generated sales of approximately (US)$60 million for the trailing twelve months ended October 2014.
About SurfStitch Group:
SurfStitch Group founded by Justin Cameron and Lex Pedersen in Sydney’s (Australia) Northern Beaches in 2007, has grown to become one of the world’s largest online action sports retailers. Operating under the SurfStitch, Swell and, pending completion of the transaction, Surfdome banners, SurfStitch Group employs over 500 staff globally, working with 900+ of the world’s leading action sports and fashion brands. SurfStitch delivers to nearly 100 countries with warehouse operations in Australia, France, UK and the USA.
About Quiksilver:
Quiksilver, Inc., one of the world’s leading outdoor sports lifestyle companies, designs, produces and distributes branded apparel, footwear and accessories. The Company’s apparel and footwear brands, inspired by a passion for outdoor action sports, represent a casual lifestyle for young-minded people who connect with its boardriding culture and heritage. The Company’s Quiksilver, Roxy, and DC brands have authentic roots and heritage in surf, snow and skate. The Company’s products are sold in more than 100 countries in a wide range of distribution, including surf shops, skate shops, snow shops, its proprietary Boardriders Club shops and other Company-owned retail stores, other specialty stores, select department stores and through various e-commerce channels. The Company’s corporate headquarters are in Huntington Beach, California.
