Huntington Beach-based Quiksilver Inc. has hired boutique investment bank Peter J. Solomon & Co. to help raise money or to find an investor in the struggling clothing maker, according to Reuters.
Quiksilver is looking to raise money in Europe or find an investor to take a stake in the company, according to the Reuters report, which cited sources familiar with the situation.
The company said Wednesday that improving its financial situation is its top priority as it deals with $1 billion in short- and long-term debt as of the end of January.
About $315 million of Quiksilver’s debt is coming due this year and in 2010.
Quiksilver, which designs clothes inspired by surfing, skateboarding and snowboarding, faces a severe retail downturn and a crushing debt from 2005’s $560 million buy of French ski maker Rossignol.
It sold money-losing Rossignol in a $50 million fire sale late last year that did little to alleviate long-term debt incurred to buy the business or short-term borrowing to keep Rossignol afloat before the sale.
As part of conference call Wednesday on results for the three months through January, Quiksilver said European leanders gave it a two month reprieve on a $70 million line of credit based to “accommodate the timing of a potential transaction.”
The transaction is widely believed to be a pending sale of Quiksilver’s DC Shoes brand, which likely would cover the company’s near-term debt.
Even with a DC Shoes sale, Quiksilver still would need help with its long-term debt.
Peter J. Solomon and other small Wall Street firms are getting more attention as Citigroup Inc., Bank of America Corp.’s Merrill Lynch and other big names struggle and see the government take a bigger hand in their operations.
Last year, Quiksilver hired Morgan Stanley to help it look at ways to raise money, including from existing lenders, through a stock sale or a possible private equity investment.
*For more on this story,
read about Quiksilver’s results and conference call.
