RETAIL
Boardriders to Lay off 40 People in Orange County, Calif.
Boardriders, the surfwear company, is laying off 40 employees according to records filed in early May with the state Employment Development Department.
Since the beginning of this year, Boardriders, based in Huntington Beach, Calif., has been undergoing many changes after acquiring one of its chief rivals, Billabong International, based in Australia. The deal, valued at $162 billion, was completed in April.
Since then, Billabong and Boardriders are in the process of combining their operations around the world. The two companies’ European headquarters, both located in southwestern France, are being merged.
Billabong employees, working out of Hossegor, France, are moving to the Boardriders headquarters in Saint-Jean-de-Luz, 25 miles away. A total of about 110 employees are being laid off as the two companies combine offices, according to press reports.
In California, it was not clear which Boardriders departments will be affected by the 40 layoffs, which take effect Sept. 30 in Irvine, Calif., where Billabong USA’s headquarters have been located for many years.
With the merger, Billabong is moving its Irvine operations into Boardriders’ headquarters later this year. Emails to Boardriders about the layoffs were not returned.
David Tanner, the current chief executive for Boardriders and a former managing director at Oaktree Capital Management, said the merger will mark a turning point in the industry.
Company officials previously said that the integration of the companies will be a multi-year process and is being managed by a combination of executives from both companies.
Boardriders used to be called Quiksilver until two years ago, when it changed its corporate name to Boardriders Inc.
The newly renamed company still encompasses the key brands of Quiksilver, Roxy and DC Shoes. With the Billabong merger, Boardriders now includes the labels Billabong, RVCA, Element, Von Zipper and Xcel.
Over the past few years, Quiksilver went through some rocky times, emerging from Chapter 11 bankruptcy protection in 2016. The publicly traded company became a privately held company whose $800 million in debt was restructured by private-equity firm Oaktree Capital Management, now the company’s majority shareholder.
With Oaktree Capital Management as the majority shareholder, Boardriders has been trying to get more creative in a challenging retail environment.
To go beyond retail, Boardriders entered into a new partnership a few years ago with Accor Hotels to integrate the Quiksilver and Roxy brands into Accor’s new hotel concept, called Jo&Joe, which is geared toward the millennial traveler.
Boardriders will open surf camps at future hotels and sister youth hostels, where guests can learn to surf and enjoy the Boardriders lifestyle. Accor Hotels currently has 4,200 hotels worldwide, two Jo&Joe hotels in France and hopes to have 50 new Jo&Joe hotels open by 2020.
Quiksilver was once a high-flying surfwear brand, started in 1976 after Bob McKnight and Jeff Hakman obtained licensing rights from the Australia-based company. The U.S. surfers launched their concept in a Newport Beach, Calif. garage, with McKnight peddling boardshorts from his VW bus to the few surf shops along the coastline.
From there, the company grew to a major retailer that in 2007 had revenues of $2.43 billion. Flush with cash, Quiksilver in 2005 acquired the Rossignol Group, an alpine-ski-equipment and apparel maker, for $560 million to diversify from summer-oriented surfwear to wintertime gear. The acquisition turned out to be a bad mistake as revenues dropped. Three years later, Quiksilver sold Rossignol for $147 million.
Quiksilver’s revenues, too, were in decline, dropping to $1.3 billion by 2015. The next year, the company declared bankruptcy.
