Broke surfwear brand Quiksilver will ride again.
A Delaware bankruptcy court on Thursday gave the SoCal-based company the go-ahead for its plan of reorganization, which will come into effect on or around the week of Feb. 8.
The plan, which had already received significant support from the company’s major stakeholders and unsecured creditors committee, will allow Quiksilver to leave Chapter 11 proceedings next month as a private entity.
“This is an important milestone in the evolution of Quiksilver and we are pleased with the court’s confirmation of our plan to emerge from bankruptcy only months after filing our voluntary petitions,” Pierre Agnes, chief executive officer, said in a statement. “This is a testament to our strong vision, leading and resilient brands, passionate employees and loyal customers.”
Quiksilver, which was founded in 1969 and also owns Roxy and DC Shoes, filed for Chapter 11 bankruptcy protection for its U.S. operations last September, listing more than $100 million in assets against more than $500 million in liabilities.
Business had been bad stateside for years, with sales sinking from a high of $100 million in profit in 2005 to a net loss of $336 million for the 12 months ended Jan. 31, 2015. Its European and Asia-Pacific operations, however, have remained strong.
As previously announced, Quiksilver intends to carry out a financial and operational restructuring that includes downsizing its U.S. store base and handing control of the company to Oaktree Capital Management, which holds 73 percent of its debt. Funds managed by the investment firm will then convert substantial existing U.S. debt holdings into a majority of the stock in the reorganized company.
“Today marks a new beginning for Quiksilver, Roxy and DC Shoes. We will emerge as a revitalized and stronger company with experienced leadership, rationalized operations, a clean balance sheet and a world-class partner in Oaktree, who brings additional strategic and operational expertise to our company,” Agnes continued. “The reorganization plan we have put in place provides us with the strong long-term financial foundation to fuel the success of our brands globally and positions us well to reassert our leadership position in the action sports industry.”