GOLD COAST: Billabong has revealed plans to acquire a young Californian brand at the same time as it faces new competition on its purchase of West 49.
The surfwear giant announced it has reached a conditional agreement to acquire 10-year-old brand RCVA. Billabong CEO Derek O'Neill said RVCA was one of California's most exciting emerging brands, with a “very strong” presence in the US.
RCVA founder Pat Tenore said the brand's existing management team will remain in place under the new ownership deal.
“By joining with Billabong we can retain our focus on our creative strengths, while leveraging the distribution and supply chain infrastructure and support of the Billabong group,” Tenore said.
However the announcement of the RCVA deal was coupled with an update on Billabong's plans to purchase Canadian brand, West 49.
While Billabong announced on June 30 it had entered into a definitive acquisition agreement with West 49, the Canadian brand disclosed on July 9 it had received an acquisition proposal from a competing company, Zumiez Inc.
The West 49 board intends to allow Zumiez to conduct due diligence to determine if its proposal can become a firm offer financially superior to the Billabong offer.
Billabong stated it will continue to monitor the situation surrounding the West 49 deal.
West 49 was founded in 1995 by Sam Baio and operates 138 shopping centre- based stores throughout Canada. The brand produces apparel, footwear, accessories and equipment for the sports action market.
RCVA was founded in 2000 and produces casual menswear as well as a recently launched womenswear line.