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Outdoor Upstart Kathmandu Bets on Surfwear in $234 Million Acquisition

New Zealand outdoor retailer Kathmandu has acquired Australian surfwear brand Rip Curl in a $350 million Australian dollars ($234 million) deal designed to bolster the former’s seasonality profile as it expands its global reach.

On a quest to be the “Ultimate Surfing Company,” Rip Curl was founded in 1969 by surfers Brian Singer and Douglas Warbrick and has since operated as a designer, manufacturer, retailer and wholesaler of surfing apparel, equipment and accessories.

The brand operates in a swath of global markets including North America, Europe, Southeast Asia and Brazil—along with its domestic presence in Australia and nearby New Zealand.

Kathmandu said it plans to leverage Rip Curl’s summertime appeal to attract shoppers year-round while simultaneously using the brand’s global presence to gain access to two important markets: North America and Europe. The move also echoes Kathmandu’s decision to acquire American outdoor footwear brand, Oboz, for $75 million in 2018 as another way into those same markets.

“This is a fantastic opportunity for Kathmandu to grow and diversify,” Kathmandu CEO Xavier Simonet said in a statement. “The acquisition of Rip Curl transforms Kathmandu into a $1.0 billion New Zealand dollars ($630 million) outdoor and action sports company, anchored by two iconic global Australasian brands. The combination of Kathmandu, Oboz and Rip Curl achieves diversification in product, channel, geography and seasonality, and creates a platform for the acceleration of our brands’ global expansion into new channels and markets. Importantly, there is also strong cultural alignment between our brands, underpinned by a shared focus on quality, innovation and sustainability.”

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Rip Curl’s surfwear products range from boardshorts, swimwear and watches all the way to “highly technical” wetsuits and surfing accessories. The brand operates on a multi-channel model, bolstering a stable of branded stores with an online presence and an extensive network of wholesale partners. Combined with Kathmandu and Oboz, the group will own 341 retail stores, operate 254 licensed stores and gain access to more than 7,300 wholesale clients.

Kathmandu, which has traditionally concerned itself with cold-weather apparel, said the move will broaden its appeal.

“We are excited about the opportunity to partner with another iconic Australasian brand that shares our vision of creating high-quality functional products for outdoor and action enthusiasts,” Rip Curl CEO Michael Daly added. “We look forward to continuing to grow the Rip Curl brand as part of the Kathmandu Group.”

Daly will lead the Rip Curl team from Torquay, Australia, reporting to Simonet.

The deal is expected to be finalized by the end of the calendar year, subject to approval when shareholders meet on Oct. 18.