Gathering storms.

Who's catching the next wave of consolidation in the close-knit surf industry?

The most recent move was New York-based Warnaco Group Inc.'s $41 million offer three weeks ago for Irvine-based Ocean Pacific Apparel Corp.

Warnaco, with annual sales of $1.2 billion, makes clothes under the Calvin Klein, Speedo and Chaps by Ralph Lauren names.

Greensboro, N.C.-based VF Corp. in June bought Santa Fe Springs-based Vans Inc. for $396 million. Earlier this year, Huntington Beach-based Quiksilver Inc. gobbled up Vista-based DC Shoes Inc. for $87 million in cash and stock.

Decades ago, the surfwear landscape was dominated by upstarts. Today, the many upstarts are overshadowed by a handful of hip brands that have either grown to be large or been acquired by deep-pocketed parents.

"Some of the 'outsiders' of the action sports world who dominate the apparel sector, such as Liz Claiborne, have announced publicly their enthusiasm for the sector," said Paul Altman, vice president of Los Angeles-based investment bank Sage Group LLC, which represented Ocean Pacific in the Warnaco deal. "The fundamentals of the youth culture demographic are simply too compelling to stay on the sidelines."

Companies believe it's often easier to buy credibility in the market than build it from scratch, said Christy Lowe, managing director of Santa Monica-based USBX Advisory Services.

Of course, buying a cool brand isn't a slam-dunk for mainstream clothing makers. They risk looking like the square dad who's adopted new lingo.

The result of consolidation is that it's getting harder for the smaller companies to survive, said George Walt, senior partner at Costa Mesa-based law firm Rutan & Tucker LLP, which also represented Ocean Pacific.

--Orange County Business Journal