Our favourite mountain-wear and surfer-style brand has filed for bankruptcy and we couldn’t be more bummed out to bring the news.
On Wednesday, Quicksilver’s US division filed for Chapter 11 Bankruptcy.
European and Asian operations will not be affected, however the US sector will see drastic changes in the upcoming months.
Let’s get some context first…
A little bit about the company
Quicksilver was founded in Australia in 1969, and landed on US soil in 1976. The US division is now based out of Huntington Beach, California.
The company started out selling wetsuits and helmets. Eventually it grew to be a well known clothing brand based for mountain and ocean lovers.
The company saw its peak in the mid 90’s, when it was one of the most widely recognized brands in the industry.
So what went wrong?
In 2005, Quicksilver acquired Rossignol. This risky business move cost the company more than just a couple bucks. Three years after the acquisition, Quicksilver sold Rossignol for half the price for which it originally bought it for.
Quicksilver’s debt began to build from that point on. In 2013, things began turning around for the worse as the company saw competition in the US rising. Fastforward to the present, and we see that Quicksilver shares have gone down by a whopping 80% in the past year. This is mainly due to shipping and accounting problems.
This past month, Quicksilver accepted their fate and started looking for a new buyer.
Where do things go from here?
Under Chapter 11 Bankruptcy Protection, Quiksilver US will be able to continue running operations while plans for a redevelopment plan are underway.
To fund the restructuring, Oaktree Capital Management affiliates and the Bank of America will loan Quicksilver 175 million. As the majority of funding is from Oaktree, the company will exchange debt for ownership, taking the reigns of the Quicksilver name.
The bankruptcy plan is currently pending approval.