Citigroup’s Kate McShane and Corinna Van der Ghinst wonder if VFC (VFC) will buy Quiksilver:
[We] believe VFC is the most likely apparel company in our universe to make an acquisition in 2014. Our meetings with management have indicated that with the Timberland acquisition fully integrated & growth plans on track, and having returned the balance sheet to pre-TBL debt levels, they are actively seeking their next deal…
Following VFC’s unsuccessful bid for Billabong LY, we think Quiksilver could be a consideration, based on: 1) a strong, authentic action sports brand; 2) a solid girls’/women’s brand in Roxy, which we believe still has significant potential, esp given ongoing strength in kids’ action/activewear, 3) DC Shoes, which would complement VFC’s Vans; & 4) Quiksilver should also help alleviate some of VFC’s 2H exposure, as it is more of a 1H brand.
hhmm