Sponsors
Billabong ▼ -0.020 | PPR ▲ +1.00 | American Apparel ▼ -0.036 | The Buckle ▲ +0.14 | Columbia ▼ -0.73 | Deckers Outdoor ▼ -1.21 | Dicks ▼ -0.11 | Foot Locker ▲ +0.97 | Genesco ▼ -0.58 | Iconix Brand Group ▼ -0.12 | Jarden Corp ▼ -0.05 | Nordstrom ▼ -0.20 | Luxottica ▲ +0.40 | Nike ▲ +0.24 | Pacific Sunwear ▼ -0.04 | Skullcandy ▼ 0.00 | Sport Chalet - 0 | Urban Outfitters ▲ +0.01 | VF Corp ▼ 0.00 | Quiksilver ▼ -0.02 | Zumiez ▲ +0.11 | Macys ▼ -0.01 | Tillys ▲ +0.12 |
Ticker Sponsor
Readers Say
In touch with our business
In touch with our business

If you're not plugged into Shop-Eat-Surf.com daily, you're out of touch with our business!

- By Peter "PT" Townend, The ActivEmpire
I waited too long to sign up for Executive Edition
I waited too long to sign up for Executive Edition

I read Shop-Eat-Surf at every opportunity, and I waited too long to sign up for the Executive Edition. It’s timely, relevant and clearly “from the industry, for the industry.

- By Andy Laats, President, Nixon
Industry Insight

CURVEXPO: Recap of the swimwear & lingerie show in Las Vegas.

SIMA: Save the Date invitation for Humanitarian Fund's STOKES ME Bowl-a-rama on Sept. 16.

Details on Industry Insight.


Tiffany Montgomery
Print This Article

The challenges facing the Adrenalina bid

By Tiffany Montgomery
October 20, 2008 9:25 AM

I've talked to several financial folks this morning to see if they think the bid by Adrenalina for PacSun is possible.


I'll summarize what they said the challenges are:


Financing: At a time when credit conditions may be the tightest they have ever been, it will likely be difficult for Adrenalina to raise the $250 million to $300 million needed to purchase PacSun, analysts say.


Size: Adrenalina is small compared to PacSun. The company currently operates three stores. PacSun operates 938.


During the fiscal year ended December 31, 2007, Adrenalina had revenues of $3.3 million and incurred a net loss of $5.8 million. PacSun had $1.4 billion in net sales and net income of $39.6 million.


Valuation: Though the $4.50 offer is above PacSun's trading price of $3.78 this morning, analysts said it doesn't take into account the value of PacSun's large stores base and retail infrastructure.


Bloomberg quoted an analyst along those lines. From the Bloomberg story:


"Amy Noblin, an analyst at Pali Research, was skeptical.

 

"We think this particular deal is unlikely to happen given the low price,' she wrote in a research note Monday. Pacific Sunwear's value is closer to $10 a share," she said.

 


More on: PacSun, bid, Adrenalina

Articles You Might Have Missed