Shares of Skullcandy Inc. surged 16 percent Wednesday after news surfaced that its founder and former chief executive Richard P. Alden was exploring possibly taking the company private.
Alden’s explorations surfaced in a filing by Ptarmigan LLC, which manages two trusts that own about 12.6 percent of Skullcandy’s share on behalf of Alden’s children. In its filing, Ptarmigan disclosed that representatives of Alden approached it June 6 to gauge its interest in investing alongside other entities controlled by Alden to take Skullcandy private.
“In connection with a Potential Transaction, directly or through their representatives or affiliates, each of Ptarmagin and Mr. Alden may engage in discussions with one another and/or their respective affiliates, representatives and advisors, potential financing sources for such a transaction, the Issuer, and/or other stockholders of the Issuer,” reads the filing. “Either or both of Ptarmagin and Mr. Alden may determine to participate directly or indirectly in a transaction involving the Issuer, including by, among other things, contributing their respective shares of the Issuer’s Common Stock in exchange for an equity interest in the successor to the Issuer following such a transaction.”
Skullcandy, which is based in Park City, got its start designing and making audio ear buds, headphones and other audio and gaming components for snow boarders, skaters and other action sports enthusiasts. Following several years of double-digit sales growth, however, its growth slowed last year as competitors flooded the market with look alike products.
On Tuesday, Skullcandy’s shares surged 16 percent to to $4.80 in after hours trading after news of Alden’s plans surfaced. They closed Wednesday at about $4.54, well off their lows of $3.13 earlier this year but well below their $8 level of a year ago.
