Action sports brand Quiksilver will "cut 80 jobs" after filing for bankruptcy with a "plan to hand control over to lender Oaktree Capital Management," according to Hannah Madans of the ORANGE COUNTY REGISTER. Affiliates of Oaktree "will supply the chain" with the $175M financing it "needs to get through a restructuring." At the conclusion of that process, Oaktree "will exchange its debt claim for a majority stake in a reorganized Quiksilver." Sources said that Quiksilver "had already begun talking with potential bidders before filing for bankruptcy in Delaware" (ORANGE COUNTY REGISTER, 9/9). Shares of Quiksilver were trading at $0.46 per share at presstime, up 0.5% from the close of business yesterday and down 83.5% from its 52-week high (THE DAILY).
WHAT DOES THE FUTURE HOLD?: Newly appointed Quiksilver President Greg Healy said, "We have been through an extensive process over [the] past three months, we talked to many suitors and this is where we end up. Unfortunately, due to the missteps over [the] past few years ... this is the best option to secure the future of the company. This is not a step we took lightly." In Sydney, LaFrenz & Mitchell reported Quiksilver's European and Asia-Pacific operations, which include Australia, "will not be part of the bankruptcy filing." Oaktree's sizeable investment in Quiksilver "has raised questions" about the investment firm's 18.7% stake in Billabong and its "longer-term plans for the two companies, which are leading players" in the $19B global action sports market. Analysts said that a merger of the two retailers "was not out of the question, as there would be significant synergy benefits and cost savings." However, Healy "quashed speculation about a possible future merger." He said, "That is not the case" (SYDNEY MORNING HERALD, 9/9). In Sydney, Eli Greenblat reported Quiksilver will "continue to support top athletes, headlined by Australian and six-time world surfing champ Stephanie Gilmore and other globally recognised surf, skate and snow athletes" (THE AUSTRALIAN, 9/9).
