Paul Naude Leads Bid to Acquire Rip Curl from Struggling KMD Brands

Paul Naude, founder of Stokehouse and brands like Vissla, is spearheading a consortium's bid to acquire surfwear giant Rip Curl from its parent company, KMD Brands. The move comes as KMD Brands faces significant financial challenges, with its stock value plummeting. Naude believes the surf industry needs authentic leadership with scale, a void he aims to fill with Rip Curl.

Key Takeaways

• Paul Naude, through his company Stokehouse, is attempting to purchase Rip Curl.
• KMD Brands, Rip Curl's current owner, is experiencing a significant stock decline.
• KMD Brands has rejected the bid, citing a lack of shareholder value and execution challenges.
• Naude believes the surf industry has lacked authentic, scaled leadership.
• Rip Curl is KMD Brands' largest and top-performing brand.

The Bid for Rip Curl

Stokehouse, which owns Vissla, Sisstr, and Amuse Society, has made a play for Rip Curl, a brand currently under the umbrella of KMD Brands. KMD Brands also owns Kathmandu and Oboz, but has seen its stock value drop by approximately 46% to 50% over the past year on both Australian and New Zealand exchanges. Naude sees this downturn as an opportunity to reintroduce authentic surf culture leadership to a major brand.

Naude expressed to Shop Eat Surf Outdoor that the surf industry has been "somewhat rudderless" for over a decade, with major brands steered by individuals lacking deep surf industry knowledge. He believes there's a significant opportunity for a leading company with scale and authentic brands to emerge, especially given the current industry landscape.

KMD Brands' Rejection

KMD Brands has publicly stated its opposition to the bid. Chairman David Kirk asserted that the proposal from Stokehouse "creates no value for shareholders and is challenging from an execution standpoint." He also pointed out that combining multiple directly competing surf brands is not a proven effective strategy. KMD Brands is focused on executing its "Next Level" turnaround strategy.

Despite the rejection, KMD Brands confirmed it has engaged Goldman Sachs to assist with its treasury and capital management strategy as it navigates refinancing long-term debt. However, no decisions regarding recapitalization have been made.

Rip Curl's Significance and Market Position

Rip Curl remains KMD Brands' largest and most profitable brand, generating NZ$550.4 million (US$322.8 million) in annual revenue for the fiscal year ending July 31, 2025. There are indications that KMD's turnaround plan is gaining traction, with Rip Curl reporting a 5.6% year-over-year increase in total sales for the August to December 2025 period. Notably, Rip Curl is the only major heritage surf brand (alongside Quiksilver, Billabong, O’Neill, Volcom, and Hurley) that does not operate under a licensing model.

Naude, who previously led Billabong's North America business, sees this unique position as a key opportunity. Stokehouse stated to the Australian Financial Review that there is a chance to create a leading "pure-play" surf company managed by experienced individuals committed to surf culture. KMD's largest shareholder, Allan Gray, has reportedly expressed frustration with the pace of KMD's turnaround efforts and suggested that recapitalization should be a last resort, implying openness to exploring all options.

Stokehouse is reportedly working with Australian financial advisors Ellerston Capital and Morgans on the bid. Naude has expressed some dissatisfaction with the negotiations becoming public, acknowledging the possibility that a deal may not materialize.

Sources

• Updated: Paul Naude Makes Play for Rip Curl, Shop Eat Surf Outdoor.
• Vissla Owner Making Bid to Buy Rip Curl, The Inertia.