Pacifica Publishing Corp., the nation's leading producer of surf-wear shows and publisher of Action Sports Retailer, said Friday that it has tentatively agreed to be acquired by a New York-based company.
Pacifica signed a letter of intent to be purchased for an undisclosed sum by Gralla Publications, another producer of trade shows and publisher of related trade magazines, executives of both companies said.
Industry sources estimated the sale to be valued at $6 million to $10 million.
Steve Lewis, the 47-year-old president and co-founder of Pacifica, said that the deal is still being negotiated. "If a sale occurs, Pacifica Publishing will be run autonomously by the present management system. It will be business as usual and I'll stay on" as president under a one-year contract, he said.
Jeff Wetmore, 43, Pacifica's vice president who owns the company with Lewis, will become an adviser with less involvement in day-to-day operations, Lewis said. Pacifica's 52 employees should not be affected by the sale, he said.
In a letter relating to the transaction mailed Thursday, Lewis said the sale will "let us continue the steady growth of the publication and shows."
For the past decade, Pacifica has published the monthly Action Sports Retailer magazine, a monthly trade magazine considered to be the Bible of the $1-billion surf-wear and active-wear industry.
The publication is sent free of charge to 14,500 retailers nationwide. The magazine--which makes money from about 300 pages of colorful ads--displays the latest in board-shorts, bikinis, wet suits, skate- and snow-board apparel and related accessories.
"They expanded and exploded the (surf-wear) industry by providing a forum for every person who wanted to be in the business," said John Bernards, director of operations for Ocean Pacific Sunwear and an exhibitor at the first Action Sports trade show in 1981. "If some guy had an idea and $2,000, he got some samples made, got into the show, and literally was in the business."
At the Action Sports trade show in San Diego next week, about 900 apparel manufacturers--including such surf-wear heavyweights as Gotcha, Quiksilver, Billabong and Stussy--will show their latest wares to as many as 9,000 buyers representing outfits ranging from Nordstrom to Newport Surf & Sport. The 2,000 booths at the show rent for about $1,000 apiece.
In addition to its involvement in the surf-wear industry, Pacifica is the largest trade show producer for two other specialty markets--performance racing and the backpacking, hiking and outdoors sports industry.
It publishes Performance Racing Industry, a trade magazine geared toward makers of professional racing products, and Outdoor Retailer, a trade magazine aimed at stores that sell camping, canoeing and hiking supplies.
Gralla hopes to complete the purchase of all three magazines and the three sets of trade shows by the end of February. Gralla operates 18 trade shows and publishes 21 business magazines ranging from Meeting News and National Jeweler to Corporate Travel and Premium Incentive News.
Surf-wear industry sources expressed optimism Friday when told of the potential sale.
"It's a great move if the show continues in the same course," said Paul Heussenstamm, owner and president of Newport Surf & Sport Inc., a clothing maker and retailer. "But if Gralla lets in a lot of discounters with low-level surf gear, it could be detrimental to our industry."