Surf’s up: Rip Curl hit by M&A wave as NZ rival pounces in $236m deal

Wild ride: Kathmandu’s deal with Rip Curl leaves the New Zealand outdoor clothing brand riding high with more than 341 stores around the world. (Shutterstock)
Updated 01 October 2019

Surf’s up: Rip Curl hit by M&A wave as NZ rival pounces in $236m deal

  • End of an era as outdoor brand Kathmandu snatches control of the last of Australia’s big three surfwear brands

SYDNEY: New Zealand outdoor clothing maker Kathmandu Holdings said that it will buy Rip Curl Group for A$350 million ($236 million) in a deal that leaves the last of Australia’s big three surf brands under overseas control.

Kathmandu said that the acquisition would make it a NZ$1 billion ($625 million) company, expand its presence in Europe and North America, and give it a “seasonal balance” between Rip Curl’s summer/beach focus and Kathmandu’s winter and outdoor offerings.

Started in 1969 by surfer friends Brian Singer and Douglas Warbrick, and still based at popular Bells Beach in Victoria, Rip Curl with local rivals Billabong and Quiksilver ranked among the world’s biggest brands for sales of wetsuits, boardshorts and popular branded beach T shirts.

The sale closes a chapter on Australia’s once central role in surfwear culture. US private equity firm Oaktree Capital gained control of Billabong and Quiksilver over the past three years following troubled efforts by the companies to expand globally.

Singer and Warbrick will gain shares in Kathmandu as will Rip Curl CEO Michael Daly, who will continue in his role and report to Kathmandu CEO Xavier Simonet, the companies said.

Clothing retailers around the world are paring back brick-and-mortar operations to compete with online giants such as Britain’s ASOS and low-cost “fast fashion” chains such as Zara, owned by Spain’s Industria de Diseno Textil.

The fiercer competition has coincided with economic headwinds which have prompted central banks to cut lending rates.

“We are seeing rates being cut around the world, which means the cost of capital for foreign entities is getting much cheaper ... so we’ll probably see more M&A because of that,” said Daniel Cuthbertson, managing director of Value Point Asset Management.

After buying Rip Curl, Kathmandu said that it will have 341 of its own stores around the world, plus 254 licensed outlets in Australia, New Zealand, North America, Europe, Southeast Asia and Brazil.


Saudi Arabia jumps up global talent league

Updated 19 November 2019

Saudi Arabia jumps up global talent league

  • The Kingdom rose five places in the annual survey

DUBAI: Saudi Arabia has jumped up the global league tables for the quality of its business executives, as measured by the International Institute for Management Development (IMD), the prestigious Swiss business school, in its 2019 World Talent Ranking.

The Kingdom rose five places in the annual survey, leapfrogging the UAE in 30th place for the first time and closing the gap on Qatar in 26th position.

The IMD’s improved rating for Saudi Arabia comes after the Kingdom jumped up the World Bank’s “doing business” ratings and an improved performance in the World Economic Forum’s global competitiveness rankings.

IMD said that Saudi Arabia showed improvements in the investment and development categories it judges, as well as readiness for economic and managerial change.

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1st

Switzerland was first placed in the IMD rankings, followed by Denmark and Sweden.

It also scored high on the availability of apprenticeships, the prioritization of employee training, access to specialist skills and the availability of senior managers with international experience and finance skills.

In terms of its appeal to executive talent, however, Saudi Arabia was further down the placings.

Jose Caballero, senior economist at the IMD competitiveness center, told Arab News that Saudi Arabia could improve its appeal by “encouraging its private sector to prioritize talent attraction and retention, as well as focusing on increasing the levels of worker motivation, and the quality of life it offers.”

He added: “The talent potential of Saudi Arabia is captured in one of the Vision 2030’s key themes: A vibrant society, with strong foundations, especially in relation to education.”

But despite spending a big proportion of its GDP on
education, expenditure per student is relatively low, as is the quality of secondary schools and teacher-pupil ratios. The Kingdom ranks comparatively low down the ratings for adult literacy, Caballero added.