More drama is unfolding for troubled SurfStitch, owner of Swell, Surfdome, and Stab Magazine, which is in the midst of a strategic review to determine its future.
SurfStitch started as an online retailer in Australia, and then rapidly expanded after raising capital and going public.
The company has been under fire for its low stock price, over promising about the potential of its business plan, poor execution and leadership changes.
On Monday, the company announced it has received several unsolicited acquisition proposals, and was reviewing them as part of the company’s strategic review.
The company also said one of the offers is from Coastalwatch, a surf forecasting company in Australia that provided surf forecasts for SurfStitch. Coastalwatch is currently suing SurfStitch over contract disputes.
Entities associated with Coastalwatch also own 10.4% of SurfStitch stock, according to SurfStitch.
Because of the litigation and the conditional nature of the acquisition offer, the SurfStitch board of directors does not think it is a proposal worth pursuing.
The board also thinks the 20 cents per share Coastalwatch offer is too low, even though the company’s stock has been trading at around 19 cents per share.
Surf Hardware International
In August, SurfStitch announced it was selling Surf Hardware International, owner of FCS fins, because it did not fit with the company’s retail focus.
This week, SurfStitch said the sale process is well advanced and the company is considering numerous options.
Â
Â
SurfStitch has hired a firm to review its strategic options as a whole and is focused on cost cutting.
