Skis Rossignol slows Quiksilver run

3rd January 2005, Comments 0 comments

PARIS, Jan 3 (AFP) - Shares in Rossignol, the French company that is the world's largest ski equipment maker, surged Monday after the Australian-US surfwear company Quiksilver said it was negotiating a takeover.

PARIS, Jan 3 (AFP) - Shares in Rossignol, the French company that is the world's largest ski equipment maker, surged Monday after the Australian-US surfwear company Quiksilver said it was negotiating a takeover.

Shares in the company were being traded at about 16.25 euros late in the day here, a jump of 5.52 percent and nearly double what the shares were worth a year ago.

Financial analysts said Quiksilver's interest in Rossignol was not surprising, given that Rossignol's potential earning power may have been underestimated.

Monday's spurt came after the president of Quiksilver Incorporated, Bernard Mariette, told the French financial newspaper Les Echos that he was in talks with the Boix-Vives family that controls Groupe Rossignol about acquiring the company.

Quiksilver, he said, "has the means to finance such an acquisition without a problem."

Rossignol chairman Laurent Boix-Vives issued a statement Monday acknowledging that a letter of intent had been received but added that "no response has yet been given."

The 78-year-old, whose two daughters have expressed no interest in taking over his company, said he planned to remain involved with Rossignol and added that he had was regularly approached "by various interested parties" looking to take a stake.

Although the Boix-Vives own 45 percent of Rossignol and hold 63 percent of its voting rights, the overture could spark a bidding war.

The US sporting giant Nike is reportedly also believed to be interested in snapping up the French group, replicating the sort of group that its German rival, Adidas, created by taking over Salomon.

On the Paris Bourse, analyst Xavier de Champsavin of Financiere Meeschaert noted that if the reported bid by Quiksilver "were really serious the share quotation would have been suspended."

Another dealer, who asked not to be named, recalled that Rossignol will celebrate its 100th birthday in two years, adding: "I would not be surprised if the succession (to Boix-Vives) took place after that anniversary."

The pursuit of Rossignol stems from the changing face of winter sports.

Gone are the days of mountain resorts being packed exclusively with jump-suited skiers. Today, runs are packed with a variety of snow-users, from traditional skiers to growing legions of snowboarders and a small number sliding along on permutations like stunted-ski "big feet".

Fashion trends have also morphed, with many of the young skiers and snowboarders adopting looks based on surfers - the kind of style of apparel that has propelled Quiksilver to the top of its segment of the sportswear market and allowed it to branch out into streetwear.

The company, founded in Australia but now based in Huntington Beach, California in the United States, broke a USD 1 billion (EUR 740 million) in sales this year.

Its revenues over the 12 months to end October were USD 1.27 billion (EUR 940 million), with about 40 percent of the take coming from Europe, where its regional headquarters is in St. Jean de Luz, a surfer town in southwest France.

Groupe Rossignol, a company Laurent Boix-Vives built up over the past five decades from a small brand that has been around since 1907, had revenues of EUR 479 million (USD 647 million) in the last financial year, with half of its sales from Europe and 40 percent from North America.

Two-thirds of its money comes from skis and ski clothing. Another 7.2 percent comes from snowboards and related apparel, with the rest made up of equipment and clothing for golf, tennis and rollerblading.

It estimates that a third of the skis, and a fifth of ski boots, in the world flash the Rossignol bird logo or one of its subsiary brands, which include Dynastar and Authier.

Mariette told Les Echos Rossignol was the company Quiksilver wanted most to acquire for its strategy of moving into the mountains, but "it's not the only possible one."

The two groups were looking at what sort of deal might be struck, "but we are still far from having a price, on their side as well as on ours," he added.


Subject: French News

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