Quiksilver to Buy Its European Marketer for $10.5 Million : Buyout: Through Na Pali S.A., the surf wear manufacturer hopes to create the kind of success it had early on in the U.S.

Positioning itself for the opening up of the European markets in two years, Quiksilver Inc. will purchase a French company that has the license to market its neon-colored surf wear and other beach-oriented products on the Continent, the companies said Wednesday.

The Newport Beach maker of surf wear and related products said it has agreed to purchase Na Pali S.A., a privately held licensee for Quiksilver products in Europe, for $10.5 million. Na Pali, which is in Biarritz, France, distributes Quiksilver brand items to 600 stores in France and to another 1,000 stores in 16 European countries such as Germany, Italy, Spain, Great Britain and Greece.

“It’s an excellent opportunity for us. We’ve been working on it for almost a year,” said John C. Warner, chairman of the board and chief executive officer of Quiksilver Inc., which owns the Quiksilver trademark for the United States and Mexico.

Warner said that in Europe through Na Pali, he would like to re-create Quiksilver’s early success in the United States.

“There are a lot of similarities between Na Pali now and Quiksilver U.S.A. four years ago,” he said. “They’re a small, entrepreneurial company servicing a big market, and they have developed a high image and high demand level.”

Warner said the acquisition will position the company to expand as the European Community lowers trade barriers in 1992.

The announcement comes at a time when Quiksilver is facing a generally slumping retail market at home as well as tougher competition in the surf wear market. The company’s stock fell from $29.50 earlier this year to $10.75 on Wednesday.

In mid-August, company President Bob McKnight sent a letter to a number of shop owners bemoaning an oversupply in the surf wear market. The letter blamed much of the problem on private-label manufacturers. It said further that some segments of the surf wear business “might have a tough time getting through this period.”

Quiksilver reported a net income of $7 million on sales of $70.7 million for the fiscal year ended Oct. 31. The company expects revenue to top $90 million this year. For the fiscal year ended May 31, Na Pali reported sales of about $21 million and pretax income of about $800,000.

The agreement with Na Pali requires Quiksilver to provide the licensee $5 million in working capital at the closing, which is anticipated by Dec. 1. The transaction is subject to the approval of the board of directors of both companies, of Quiksilver Garments Pty Ltd., the Australian licenser of the Quiksilver name, and the French Ministry of Finance.

The agreement will also be subject to the renegotiation of the license agreement between Garments and Na Pali.

Warner said there may be differences in the European products. There might, for example, be more items for board sailing because that sport is more popular there.

“And there’s no California in Europe,” he said.