Credit rating company Moody’s Corp. is reviewing ratings for Huntington Beach-based Quiksilver Inc. for a possible downgrade as the clothing maker tries to sell its ski gear business.
Moody’s is looking at the uncertainty surrounding Quiksilver’s effort to complete a sale of Rossignol, a French maker of skis and related gear it bought in 2005.
A sale of Rossignol, which has been a drag on Quiksilver since the acquisition, would boost Quiksilver’s creditworthiness, according to Moody’s.
But the timing and amount of a sale could impact the company’s current credit ratings, Moody’s said.
In May, Quiksilver said it had begun a process to sell Rossignol.
Quiksilver didn’t offer details on who is in the process of buying Rossignol or when a deal might close.
The company appears set to sell Rossignol for much less than the $560 million it paid for the business in 2005.
It took a $240 million charge for the recently ended quarter, stemming from a writedown in the value of Rossignol “triggered by the sale process.”
