Ocean Pacific to Sell Its Biggest Division, Jimmy’Z : Beachwear: At a time when it was looking for a buyer for itself, Ocean Pacific agreed to deal off Jimmy’Z to a group that includes that division’s management.

Ocean Pacific, the nation’s leading surfwear maker, said Thursday that it has agreed to sell its largest division, Jimmy’Z, to a group including that unit’s management for an undisclosed amount.

Ocean Pacific signed a letter of intent to sell the division to Jimmy’Z president Dennis Donsker, vice president of sales Don Wood, and two Jimmy’Z licensees, Diane Skilling and Norman Leftkovitz.

Donsker has headed Jimmy’Z since November, when the company’s former president, Steve Bowman, was replaced because Ocean Pacific officials “wanted to see some better results,” Ocean Pacific spokesman Jerry Crosby said. The division has been losing money, he added.

The sale comes at a time when Ocean Pacific has been unsuccessfully searching for a buyer for the entire company. The firm last year hired Goldman Sachs & Co. in Los Angeles to scout for potential purchasers.

Ocean Pacific acquired Jimmy’Z in November, 1987, from Jimmy Ganzer and Sepp Donahower, who founded the trendy surfwear maker in 1984. At the time, the Jimmy’Z line--best known for its Velcro flies and waistbands--was intended to put some life into the OP line, which had lost influence and image among the cutting-edge, hard-core surf shops.

Ocean Pacific’s annual sales are estimated at more than $250 million. Donsker, who will become chief executive of Jimmy’Z, said the division’s annual sales are slightly over $50 million, although other industry experts estimated revenues to be somewhat lower.

In an interview Thursday, Donsker declined to reveal financial details of the sale but said it was related to efforts by Ocean Pacific to sell itself for some time.

“We just carved out a little niche,” Donsker said.

He said the four investors have unequal interests but declined to detail the ownership shares. He said there will be “virtually no changes” in operations and Jimmy’Z’s 66 employees should not be affected. “At this point, everything looks intact,” he added.

Two of the new owners, Skilling and Leftkovitz, now own Longboards, a Garden Grove silk-screening company that is the Jimmy’Z licensee for screen-printed products, such as T-shirts and shorts.

He said the sale should be completed next month, after which Jimmy’Z will move from Tustin to a 40,000-square-foot building in Garden Grove located next to Longboards.

In the $1-billion surf-wear industry, Ocean Pacific has loomed large on the beach for much of the 18 years since its founding. The company--founded by Jim Jenks and Chuck Buttner--has grown from a shoestring T-shirt and shorts manufacturer to the West’s leading clothier of the casual beach set. Today, the company has 300 employees and allows manufacturers to put the OP logo on everything from sunglasses to sandals.

The move to sell the privately owned company followed the death in late 1988 of Lawrence D. Ornitz, then Ocean Pacific’s president and chief executive, who owned slightly more than 30% of the firm’s stock. The three largest owners today are Ornitz’s wife, Elaine; Robert Driver, who owns about 26% of the stock, and Jenks, who holds about 27% of the stock.

With the latest sale of Jimmy’Z, the company will be selling apparel under only two labels--its main Ocean Pacific label, as well as its Newport Blue men’s wear line, which is aimed at the older consumer.

In the year after Ornitz’s death, Ocean Pacific had re-acquired some major licenses, moving away from being primarily a licensing company and back toward manufacturing--notably men’s and boys’ swimwear and woven shirts and mens pants. But that is changing, Crosby said.

“We prefer the role of licensor and we’re not altogether comfortable as a manufacturer,” he said. Crosby also cited Jimmy’Z, in particular, as “a management challenge.”

With the sale of Jimmy’Z, Ocean Pacific is again mostly a licensing company and will be manufacturing only a small portion of the Newport Blue line.

“We consider ourselves to be sales and marketing specialists and believe the manufacturing side of the business is better left to the manufacturing specialists,” Crosby said.

It was not clear whether the sale of Jimmy’Z means that efforts to sell Ocean Pacific will be abandoned. Crosby said there are “no active negotiations” now going on.