Quiksilver Inc.’s picking up a golf gem in its buy of France’s Skis Rossignol SA: Roger Cleveland Golf Co.
The golf club maker is based in Huntington Beach, just blocks from Quiksilver’s headquarters.
Cleveland Golf, known as one of the best makers of golf wedges and drivers, is “particularly appealing,” said Mitch Kummetz, an analyst at D.A. Davidson & Co. “It could be a solid golf apparel company.”
That’s what Quiksilver says it’s banking on.
The company plans to use Cleveland Golf to make a bigger move in golf clothes.
Until now, Quiksilver’s golf reach has been limited. Its Fidra line, headed by veteran golf designer John Ashworth, is small. Quiksilver doesn’t break out Fidra sales. But in the past, analysts have estimated it at less than $10 million annually.
The buy “greatly increases Quiksilver’s exposure to golf, which was about less than 1 percent before the transaction,” wrote Lizabeth Dunn of Prudential Equity Group.
But it’s still too early to tell how things will play out.
“For the time being (Quiksilver) has told us we’re going to continue as we’ve been going,” said Randy Romberg, a Cleveland Golf spokesman. “Once that sale is complete, then we’re going to get together and see what synergies we have and what makes sense.”
Cleveland Golf has more than 325 workers at its Huntington Beach headquarters and plans to stay there, Romberg said.
The company moved into the newly built offices, which are twice the size of its old headquarters in Cypress, four months ago, he said.
Romberg declined to give Cleveland Golf’s annual sales. Reports have put them in the $160 million range.
The company has been on a tear, growing 20 percent to 25 percent per year for the last eight years, Romberg said, despite the slow golf market.
“We’re stealing market share from other people,” Romberg said.
Cleveland Golf was founded in 1979 by namesake Roger Cleveland, and started by making replicas of classic golf clubs from the 1940s and 1950s. Rossignol bought it in 1990.
Cleveland recently signed a multiyear contract extension with Vijay Singh, who is the world’s No. 2 ranked golfer.
“Cleveland Golf is sold in every green grass account,” Kummetz said, referring to pro shops and other golf stores. Quiksilver “is acquiring relationships.”
, Jennifer Bellantonio