Wedding Snow and Surf, One Board Maker Buys Another
Uniting brands that rule the slopes and dominate the waves, Burton Snowboards said Thursday that it had purchased Channel Islands Surfboards in Santa Barbara.
The two companies were born of lowly circumstances -- one in a barn, the other in a garage -- but as far as some industry insiders are concerned, it’s a marriage made in board-sport heaven. The deal pairs legendary surfboard shaper Al Merrick with snowboarding pioneer Jake Burton.
“You’re looking at two people who’ve technically pushed a sport farther than anyone else,” said Roy Turner, president of the Board Retailers Assn. “They’re both design masters, both great businessmen and obviously great branding agents. They’re kind of like the Starbucks of our industry.”
If the pairing seems natural in some respects, it is unusual in others.
“To have a surfboard manufacturer owned by a parent company outside the surf industry is a new concept,” said Eric Crane, senior vice president of Irvine surf wear maker Ocean Pacific Apparel Corp.
Although the industry typically stiffens at outsiders, the initial reaction to the deal was good because Burton -- a giant in the so-called action sports industry -- is the buyer, said Sean Smith of the Surf Industry Manufacturers Assn.
“They get it,” he said. “They’re core.”
Both Burton and Channel Islands are privately held, neither releases financial results and neither would disclose the terms of the deal. Burton is thought to be the world’s largest snowboard maker, and Merrick said his company was the world’s largest single-label surfboard manufacturer.
Putting the resources of the “Godzilla” of the snowboard industry behind the smaller Channel Islands should be a boon for the surfboard maker, said Thomas B. Doyle, vice president of information and research for the National Sporting Goods Assn. in Mount Prospect, Ill.
Merrick, 62, decided to sell his company to Burton because he wanted it to keep growing when he started “slowing down.”
“If you’re going to retire, you’re going to need money to do that,” he said. With the deeper pockets of Burton, the surfboard maker can “reach its potential,” said Merrick, who started his business in 1969 after borrowing $300 and buying “a barrel of resin and a bolt of [fiberglass] cloth.”
“I wasn’t able to take it any further,” he said. “They can take it to the next step, and our employees can benefit from that.”
“I’ll still be overseeing the company, but I’ll have a lot more help doing it,” Merrick said. “Burton has probably one of the best distribution networks in the world, and I’m sure that’s going to influence our distribution greatly and make it better and more efficient.”
Burlington, Vt.-based Burton is attaching itself to one of the most respected names on the beach.
“For a brand like Burton to get an entry into surf authentically, it’s a genius move,” Ocean Pacific’s Crane said. “It really buys them the same seat in surf that they earned in snow over the years.”
Burton, 52, said his goal for Channel Islands was to keep improving its surfboards, not to launch a clothing line or to veer into dramatically different territory. Burton, who started his business in his Vermont barn when he was 23, said his company had the money to further explore the new technology available to surfboard makers.
Although most of Channel Islands’ surfboards are made with polyurethane cores, the company also makes boards using other techniques.
The two companies say they relate well to each other partly because both rely heavily on feedback from athletes in the design of their products.
Burton sponsored snowboarders Shaun White and Hannah Teter, both of whom won Olympic gold medals at the 2006 Winter Games in Turin, Italy. Channel Islands sponsors surfing titans Tom Curren and Kelly Slater.
Burton also makes other products, including boots, bindings, travel bags and street wear. The company’s other brands include R.E.D. Impact Protection helmets, Gravis footwear, Anon Optics and Analog clothing.
As news of the deal spread Thursday, the phone started ringing at Surfside Sports in Newport Beach.
Surf industry insiders want to know how the boards will evolve, whether the quality will change and what they are going to cost, said Surfside co-owner Duke Edukas.
“All these things are going through our heads,” he said. “Taking the No. 1 surfboard company and linking it to the No. 1 snowboard company is a big deal.”