"Acquisitions of this sort take some time to digest, and analysts are expecting Rossignol to drag on performance for the immediate future." -- Rich Duprey
Allow me to nominate my fellow Fool, Rich Duprey, for understatement-er-of-the-year (2005) for the above line. While his words were pessimistic, I doubt even he guessed just how badly sports apparel company Quiksilver's
Personally, while I predicted it would be bad, the scale of the disaster surprised even me. Kind of reminded me of Talbots'
The Quik and the dead
But it ends here. Shares of Quiksilver spiked this morning as management finally owned up to its mistake and vowed to shed the dead weight that is Rossignol. However, it's paying a heavy price. After paying nearly $560 million to get into Rossignol, Quiksilver plans to part with its "prize" for a measly 100 million euro. Even at today's inflated exchange rate, that works out to less than $150 million.
Total loss on the investment: About 70%.
The Quik and the smart
In contrast, kudos today go to ex-Rossignol CEO and soon-to-be-again Rossignol CEO Bruno Cercley, who runs Chartreuse & Mont Blanc (jointly owned by Macquarie Group and Jarden
Now that's smart.
What's Quiksilver been up to lately (aside from wiping out shareholder value, that is)? Find out in: