Cloudveil has been sold yet again. This time, Spyder Active Sports sold the brand to Windsong Brands, a private equity firm based in Westport, CT. The new owners plan to quickly expand distribution of the brand within the outdoor specialty channel as well as explore extending Cloudveil to other categories.

 

With the acquisition, Jim Reilly, a former COO at the North Face, becomes Cloudveil’s president. James Samuel, formerly director of global sales for Cloudveil, becomes general manager for the brand. The new owners said they were still determining whether co-founder and President Stephen Sullivan would continue with the firm. To facilitate a smooth transition for Cloudveil’s existing dealer base, Spyder will manage the backend support, shipping, and customer service aspects of the Spring 2010 season.

 

Terms of the deal were not disclosed. All intellectual property and assets are part of the acquisition deal.

 

In an interview with Sports Executive Weekly, Windsong Brands CEO Bill Sweedler said his firm is looking to fully capitalize on Cloudveils reputation for technical expertise.  Cloudveil is a unique and authentic American brand that truly resonates with the core outdoor enthusiast, said Sweedler. And were looking to build on its DNA by expanding not only its current product offering through new, and existing, premium retail channels. But well look into expanding into accretive classifications, such as packs, footwear and other complementary areas that make sense for the brand. Its amazing to see the consumer following for this brand. Our team at Windsong is involved with several brands where we have led the acquisition, but this one is special because we have crazy outdoor guys who all live and breadth the Cloudveil lifestyle.

 

Sweedler also said hes found that although mergers are commonly justified by the efficiencies gained in sharing back-office functions, culture clashes often result when trying to blend two different brands in one organization. Moreover, he believes management will be more focused on exploring growth opportunities as an independent company.

 

Clearly the founders had done just a spectacular job of upping the ante on technical performance and we feel that the consumer has a very strong connection with its products, noted Sweedler. But the brand has been through many different transactions and has always been part of a much bigger entity. So operating on their own will let managers focus 100 percent on the brand.

 

Reilly has some direct experience managing Cloudveil and has been closely following the brand over the last few years. In January 2005, Cloudveil was sold to Sports Brand International (SBI), and Reilly, as an SVP at SBI, oversaw the division that oversaw Cloudveil along with Fila Winter Sports. After SBI was sold, Reilly went to work as a consultant for Apax Partners, which had bought Spyder in 2004. He was a member of Spyders board in February 2008 when Spyder acquired Cloudveil. He resigned from Spyders board last fall. He had been COO at The North Face from 1998 to 1999 and previously had been COO at Adidas.

 

Reilly credited Spyder with its progress in simplifying Cloudveils product line, improving sourcing and quality, and setting the stage for growth internationally. But he agreed that the brand will be managed better as a smaller, entrepreneurial company on its own. He likewise saw the potential in extending the brand to other categories, noting that consumers had regularly asked for backpacks in the past from the mountaineering brand.

 

But Reilly also said that given its reputation, it should have a positioning closer to Mountain Hardwear.   He estimated that Cloudveil is only in about 10% of the outdoor specialty doors that it could be in.

 

Its got a very small customer base and it should be easy to double and triple that pretty quickly just by better reaching its core customer base, said Reilly. Its been a very high-end exclusive kind of brand and its very, very special but theres a lot of growth to be had. We need to compete with The North Face and Mountain Hardwear and not be above them exclusively. So much of our growth will come from expanding our core technical outerwear business. And it should be good positive for the consumer because now they can find that brand.

 

Both Reilly and Sweedler said that while Cloudveil was impacted by the recession like most brands, it saw growth last year, including international expansion, and bookings are up 25% for the Fall 2010 line.

 

Its not a wounded brand, said Reilly. Its still a niche brand that has a really core following.