Outdoor financials: Quiksilver closing the gap on Rossignol takeover, plus NRF reports March retail sales, VF Corp.

Quiksilver closing the gap on Rossignol takeover
Quiksilver (NYSE: ZQK) said it closed the deal to buy nearly half the shares of Skis Rossignol SA from its majority stockholder — the Boix-Vives family — the first of two steps in the planned buyout of the French ski manufacturer. The company’s acquisition of Rossignol was announced on March 22, but execution of the purchase agreement had been pending a report on the transaction by Rossignol’s workers’ council. Rossignol’s workers’ council, also known as the “Company Central Committee,” issued its report indicating that the choice of Quiksilver by the majority shareholder offers positive opportunities for the future. The transaction continues to be subject to regulatory approvals in France and elsewhere. Quiksilver continues to anticipate a public tender offer for the remaining shares not controlled by the Boix-Vives family and expects the transaction to close prior to the end of Quiksilver’s third fiscal quarter, which ends July 31. Quiksilver has offered to buy up Rossignol’s shares at 19 euros ($24.55) apiece, valuing the firm at about $305.6 million based on current exchange rates.

NRF reports March retail sales
According to the National Retail Federation (NRF), retail industry sales for March (which exclude automobiles, gas stations, and restaurants) rose 6.8 percent over last year but dropped 0.1 percent seasonally adjusted from February, the first seasonally adjusted dip since last June. First quarter retail industry sales rose 5.4 percent over 2004. March retail sales released today by the U.S. Commerce Department show that total retail sales (which include non-general merchandise categories such as autos, gasoline stations and restaurants) rose 0.3 percent seasonally adjusted from February and increased 7.3 percent unadjusted year-over-year. Sales at gasoline stations, a category that NRF does not include in its retail sales calculation, rose 17.8 percent over a year ago.

VF gets ‘initiated’
On the heels of VF Corp. (NYSE: VFC) completing its acquisition of Reef Holdings, the Prudential Equity Group initiated coverage of VF at overweight (a recommendation for investors to increase their investment position in a particular security, sector, asset class, or market), saying the company offers investors a “great way to play the consolidation trend” in the apparel industry. A Prudential analyst said the company is exceptionally well run and is using its strong free cash flow to pay dividends and buy back stock, and set a $66 price target on the stock. The analyst added that VF has demonstrated an ability to successfully acquire large and small brands alike by improving growth and margins for many of its targets. Reef joins VF’s Outdoor Coalition and is expected to contribute about $45 million to VF’s sales and be neutral to earnings per share in 2005, and accretive in 2006.

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