The active lifestyle market confirmed once again last week that it is the place to be for investors. Public companies in the industry rode the wave of very positive third quarter reports to easily outpace the major stock market indices and a number of both private and public companies saw the opportunity to expand their businesses through acquisitions.

Most of the major indices in the active lifestyle market (see chart below) got a boost from companies posting double-digit or high single-digit share price gains in the last week. G-III Apparel led all gains with a 19.7% increase in its share price and Volcom was close behind with an 18.7% gain for the week. Golf Galaxy, GSI Commerce, and Blacks Leisure were the key retail gainers for the week, with increases of 15%, 12%, and 11.5%, respectively. K-Swiss and Skechers rounded out the double-digit performances as KSWS shares rose 11% and SKX shares increased 10.5% for the week. K2, Inc. and Deckers both got close to the double-digit mark, but fell just short.

On the acquisition front, MacGregor Golf announced plans to acquire the Greg Norman Collection Apparel business from the adidas Group with Greg Norman himself purchasing a “significant equity stake” in MacGregor Golf. adidas picked up the GNC business when it acquired Reebok International Ltd. last year. adidas had initially rolled GNC under the TaylorMade-adidas Golf business after the deal closed.

During a conference call with the media discussing the acquisition, Mr. Norman expressed his excitement about gaining control over his namesake brand, suggesting that his move to become a partner in MacGregor was in part a move to use the company as a vehicle to acquire the GNC business. Norman will serve on the MacGregor Golf board of directors and will take a proactive role with sales and marketing, product development, and international distribution. In his comments, Barry Schneider, CEO of MacGregor Golf, noted that the acquisition would be accretive to earnings and was “financially right,” but his real excitement was in the future of the two brands as he felt that both were positioned for “substantial international growth.” Neither management team would disclose exact financial details of the deal, but did note that the combined annual sales of the two companies would amount to “more than $150 million.”

adidas Group reported that GNC had accounted for €16 million ($19.2 mm) in sales when they reported their Q1 2006 results and estimated that GNC would produce between €85 million to €95 million ($106 mm to $119 mm) for the year. Given that management said GNC had enjoyed “12 consecutive quarters of sales growth,” the apparel brand would most likely account for the lion’s share of sales, if the $150 million benchmark is near the actual value at year’s end.

MacGregor Golf and Greg Norman Collection will maintain their independence with corporate offices in Albany, GA, New York, N.Y., and Canton, Mass., respectively. Reid Gorman will continue to serve as president of MacGregor Golf, while Suzy Biszantz will remain as president and CEO of GNC.

Perhaps the largest deal last week included Helly Hansen, which posted roughly $210 million in trailing twelve month sales. The company changed hands between two European private equity firms. While full details were not disclosed, sources familiar with the deal expect that the company sold for just under 1x sales, or somewhere between $185 million and $200 million. While the sales multiple is somewhat below the average selling price, speculation around the EBITDA multiple is in-line with several of the premium deals in the industry – somewhere between 10x and 15x EBITDA.

There were reportedly several top-tier strategic buyers bidding on Helly, but Altor, a three-year-old private equity firm that specializes in acquiring mid-sized companies in the Nordic region, was reportedly “very aggressive” in its bidding and took the deal home. Altor says that it works as an “active owner” to “contribute to positive and lasting change in its portfolio companies.” It is likely there will be some structural changes at Helly, primarily in the amount of debt-load the company is carrying.

Crocs, Inc. expanded its footprint a bit last week, acquiring EXO Italia, a designer and developer of ethylene-vinyl acetate, or EVA-based finished products with a focus on the footwear industry. Crocs are currently made from a proprietary “Crosslite” PCCR material, and this acquisition raises the question of where Crocs is going next.

Crocs has long been criticized as a one product company, but if it is able to develop some new footwear technology and maintain the brand’s recognition, it could expand into new product lines. No financial details from the deal were available.

On the snow sports side of the market, the Tecnica Group, which has long been associated with Volkl and Marker in the U.S., has acquired the majority, controlling interest in Blizzard Gmbh, with manufacturing, sales, and marketing based in Austria. Tecnica’s Nordica subsidiary, which is 100% owned by Tecnica will acquire 66.66% of the Blizzard Sport Gmbh shares. The remaining shares will be owned by Karl Hofstatter, current CEO of Blizzard.

One of the companies’ first steps will be to partially integrate Nordica ski production in Blizzard’s Mittersill, Austria factory. This is expected to achieve immediate synergies in raw material purchasing, ski production, and research and development of new products. Giancarlo Zanatta, president and CEO of the Tecnica Group said that Blizzard’s existing background in technology and manufacturing will compliment Nordica’s development and production, while the Italian company’s marketing expertise will help to strengthen the Blizzard brand. Mr. Zanatta expects this Blizzard acquisition to move the Tecnica Group’s annual sales beyond €400 million ($500 mm).

This most recent wave of acquisitions is showing signs of more momentum as well, with hints coming from K2 Inc. (see the full story on page 11 of this issue) and other strategic and equity investors. It is highly likely that several more deals will close before the winter show season begins.