SIMA Taps Slater, Quiksilver Picks Up DC Shoes

SIMA to Honor Slater

The Surf Industry Manufacturers Association (SIMA) will present six-time world surf champion Kelly Slater with the Waterman of the Year award at the annual Waterman’s Ball and Auction. SIMA will hold the environmental fund-raiser Aug. 27– 28 at the St. Regis Monarch Beach Resort & Spa in Dana Point, Calif.

The Waterman’s Weekend is a two-day fund-raising event that includes a golf tournament, dinner and an auction. Proceeds from the event will benefit the SIMA Environmental Fund, which awards grants to various environmental groups. Last year’s event hosted more than 800 attendees and raised $320,000 for ocean conservation groups, SIMA said.

In addition to Slater, SIMA will present filmmaker Greg MacGillivray with the Environmentalist of the Year award and legendary surfer Miki Dora with the Lifetime Achievement award. The association’s board of directors will also bestow a special award on Bethany Hamilton, who survived a shark attack while surfing last fall.

“The SIMA board of directors has selected an incredible lineup of honorees that will bring excitement and authenticity to this year’s Waterman’s Ball,” said Dick Baker, SIMA president and Ocean Pacific Apparel Corp. chief executive officer. “Every one of these individuals is worthy of admiration and truly deserving of the honor that they have been selected to receive.”

DC Shoes Joins Quiksilver

After making a sizable investment in the market-share growth of its existing brands, Quiksilver Inc. has expanded its offerings by acquiring DC Shoes Inc., a skate and snowboard lifestyle brand for young men and juniors.

The deal—reportedly a cash and stock transaction of $81 million—is the latest attempt by Quiksilver to expand its skate and snow lifestyle offerings. The company expects to close the deal by the third quarter of fiscal 2004.

“DC Shoes is a tremendous fit with our organization from a cultural, strategic and operational standpoint,” said Bob McKnight, chairman of the board and chief executive officer at Quiksilver, in a recent press statement. “They are a young, aggressive and energetic company that reminds me a lot of Quiksilver. We both share respect for the authenticity that makes our brands powerful, and we both benefit from product design that reflects technical excellence and great style. We expect to see tremendous synergies between our teams.”

The surfwear giant, based in Huntington Beach, Calif., reported sales of $975 million for the fiscal year that ended Oct. 31, 2003. The company designs, produces and distributes clothing and accessories for young men, juniors and young girls under the Quiksilver, Roxy, Raisins, Radio Fiji, Roxy Girl, Raisins Girls, Teenie Wahine, Quiksilver Edition and Fidra labels.

Quiksilver purchased Hawk Clothing, a young men’s and boys’ skate label named for professional skateboarder Tony Hawk, in 2000. The line grew from $11.2 million in 2001 to $12.6 million in 2002 but declined to $11.1 million in 2003, when the label shed its men’s collection to focus on the youth market.

DC Shoes will operate as a subsidiary of Quiksilver after the acquisition is completed. Ken Block and Damon Way, who co-founded DC Shoes in 1994, will continue to oversee the day-to-day operations as well as contribute to the company’s direction. A Quiksilver spokesman said the acquisition will allow DC Shoes to continue to operate like an independent company while giving Quiksilver a larger share of the skate market. The deal calls for the international distribution of DC Shoes’ categories, which include DC Apparel for men, DCGirls for juniors, skate shoes, hats, sport bags and accessories.

The merger with Quiksilver ends DC Shoes’ yearlong search for a cash infusion, said a DC Shoes spokeswoman. Last August, DC Shoes quietly settled a lawsuit with one-time company co-owner Clay Blehm for an undisclosed amount.

According to a Quiksilver company statement, the acquisition also includes a rollout provision with a potential to earn up to $57 million over four years. DC Shoes, whose sales exceeded $100 million last year, should have no problem hitting that mark.

“Quiksilver is the ideal partner for us,” said Way of DC Shoes in a press statement. “Their understanding of our vision as it relates to product development, marketing, distribution, global strategies and athletes could not be any better.”

The DC Shoes design and distribution center will remain in Vista, Calif., according to a company spokesperson. The young men’s and women’s skate label made a name for itself by catering to the fashion needs of extreme-sports athletes, particularly skateboarders and snowboarders. The company is known for sponsoring all aspects of the action-sports industry, including surf, skate, snow and motocross events.

DC Shoes’ active sportswear line, which focuses on teens and young men and women in their mid-20s to early 30s, includes denim, fleece shirts, shorts, screen-printed T-shirts and skate shoes. DC Shoes’ edgy boardshorts retail between $42 and $48; juniors apparel retails for $34 to $65.

The DC Shoes brand is sold at specialty retail chains that cater to the active-sports markets, including Pacific Sunwear and Zumiez.