SurfStitch further diversifies portfolio
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 in an announcement to the market today.
“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.
“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.
SurfStitch also plans to open three flagship ‘Swell’ stores in key cities across the globe.
A fully-underwritten institutional placement of ordinary shares to raise about $50 million has also been launched to 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 to beef up its digital media capabilities, creating content to target its core demographic.