Quiksilver Files For US Brankruptcy Whilst Billabong Stakeholder Swoops
The company in June blamed performance in US markets on “poor deliveries and an evolving distribution channel strategy”.
poor deliveries and an evolving distribution channel strategy.
Quicksilver, the Californian company which also owns the brands, Roxy and DC announced that it is filing for Chapter 11 bankruptcy after its share price lost nearly 80% of its market value.
In a statement, the company advised operations in Europe and Asia-Pacific were not included in the bankruptcy filing. The company has a $175 million (£113.7 million) restructuring plan, financed by Oaktree Capital Management which will exchange its debt claim for a significant stake in the revamped brand once the restructuring is complete. Oaktree also owns a stake in Quiksilvers competitor company Billabong; Oaktree Capital director Matthew Wilson was a non-executive director of Billabong until he stepped down on Tuesday, citing an unexplained “conflict of interest”.
Quiksilver was founded in Australia in 1969 when surf culture was at its peak primarily as a board shorts brand. The label developed towards fashion within surfer and skater styles in the 1990s and early 2000s and sponsored athletes such as surfer Kelly Slater and skater Tony Hawk whilst sponsoring surfing competitions around the world. In recent years as fashion has shifted and other retailers offered on trend clothing at cut cost pricing the market has taken its toll on Quiksilver.
The company said in a statement in June that North America “sales and margins are affected by poor deliveries and an evolving distribution channel strategy”. In the prior year group sales dropped by 13%, bringing its net loss to $309.4 million causing it to plane the closure of stores across the US.
Pierre Agnes, chief executive of Quiksilver, said Oaktree’s investment would allow it to “satisfy our ongoing obligations to customers, vendors and employees, but we will also have the flexibility needed to complete the turnaround of our US operations and re-establish Quiksilver as the leader in the action sports industry”.
