Online retailer Surfstitch has more than doubled its market value in less than 12 months, thanks to a series of acquisitions that have seen the former pure-play online retailer move into bricks-and-mortar retailing and digital publishing.

The latest of those acquisitions is Surf Hardware International, the surfboard and accessories manufacturer behind brands such as FCS, Gorilla, Hydro and Softech.

Surfstitch paid A$23.7 million (US$17.1 million) for Surf Hardware, which it revealed in an update to the market when it emerged from a trading halt on Wednesday afternoon.

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To fund the acquisition, Surfstitch raised A$50 million (US$36.1 million) via an institutional placement of ordinary shares, with the rest of those funds earmarked to provide the company with working capital and "the flexibility to pursue further strategic growth initiatives including complementary acquisition opportunities."

Surfstitch acquired Garage Entertainment and Production, a company that makes action-sports films and videos, for A$15 million (US$10.8 million) earlier this month and in May, paid A$21 million (US$15.2 million) for online surf content platform Stab and surf forecasting network Magicseaweed.

Surfstitch is now valued at A$511 million (US$369 million), which compares to a market value of A$214 million (US$155 million) when it floated on the Australian Securities Exchange in December 2014. The company is tipped to hit a market capitalisation of A$550 million (US$398 million) following the Surf Hardware acquisition.

That figure puts Surfstitch as more valuable than its former parent company, Billabong, which is currently valued at A$510 million (US$369 million), reports Fairfax Media.

Surfstitch bought out Billabong's 51% share in the lead up to its initial public offering, also acquiring Billabong's online retail website swell.com at the same time.

The Surfstitch group recorded total revenue of A$199 million (US$144 million) in the 2014-15 financial year, which was a 30% increase on the year before. Gross profit for the overall group was A$91.6 million ($66.2 million).

The retailer's revenue is primarily derived from the Asia-Pacific and European markets, with Asia Pacific revenue coming in at A$82.9 million (US$59.9 million) in 2014-15 and revenue from Europe totalling A$87.3 million (US$63.1 million). Just over A$29 million (US21 million) in sales were generated in the North American market.

Stuart Haines, managing director of Haines Consulting Group, told SmartCompany this morning Surfstitch has been pursuing an acquisition growth strategy and it is paying off.

"They have gone from selling their products to becoming a surf lifestyle business," Haines says.

Haines says businesses typically pursue acquisition strategies for three reasons: to take advantage of synergies and economies of scale in their industry; to achieve market penetration and to develop new distribution channels to sell their products.

Haines says Surfstitch is ticking all of these boxes and is an example to other businesses of how focusing on these three areas can work.

However, he says Surfstitch is also becoming a market leader because of the value it is creating for their customers.

"They understand their niche, what their customers do and they have tried to become different and become that leader," he says.

"They are becoming the number one surf lifestyle brand and across the world, not just in Australia."

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This article originally published at Smart Company here