Online sportswear retailer, SurfStitch, has agreed to acquire global water board distributor, Surf Hardware International (SHI), for $23.7 million.
SHI designs, markets and distributes water board sports products and accessories under the brands FCS, Gorilla, Hydro and Softech. The brand operates in Australia, US, France and Japan and has long-standing distributor relationships in other markets.
“SHI’s continuous innovation has created a portfolio of globally recognised brands and high performance products that have immense appeal to SurfStitch Group’s youth demographic,” the company said.
“SHI’s product portfolio also delivers SurfStitch Group greater exposure to the action sports hard goods markets, which has proven to be one of the SurfStitch Group’s fastest growing and most resilient categories.”
Upon completion of the acquisition, SurfStitch will integrate SHI into the group and scale up its e-commerce capabilities.
SurfStitch also plans to open three flagship ‘Swell’ stores in key cities across the globe.
“SHI’s brands and products are globally renowned in the surfing and water board sports industries,” said Justin Cameron, CEO of SurfStitch Group.
“We look forward to collaborating with SHI on the design and sale of new and innovative products, as well as creating premium and engaging content that can be shared with surfers and fans around the world via SurfStitch Group’s digital ecosystem,” he said.
The group has completed a fully-underwritten institutional placement of ordinary shares to raise $50 million which will fund the repayment of certain debts of SHI as part of the acquisition and transaction costs, the company said.
SurfStitch expects its full year underlying EBITDA, including the SHI acquisition, to be in the range of $18 million to $22 million.
Earlier this month SurfStitch acquired Garage Entertainment and Production for $15 million to beef up its digital media capabilities, creating content to target its core demographic.
New appointment
SurfStitch Group recently appointed Chris Athas, who has more than 30 years of retail experience as the founder and owner of Surfection — a large Australian surf retail chain which was successfully sold to both Billabong and Quiksilver Groups — to run SurfStitch Group’s global merchandising business. Athas will be responsible for global merchandising, including expanding the vertical line of SHI brands within the SurfStitch Group.
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