SYDNEY — Billabong International Ltd confirmed today it has entered into exclusive talks with a consortium comprised of Sycamore Partners and its former head of the Americas division, Paul Naudé, to acquire the company for 285 million Australian dollars, or $296 million at current exchange.
The exclusivity will last 10 business days. Sycamore and Naude's bid is 60 Australian cents per share, or 62 cents.
In a statement to the Australian Securities Exchange late today, Billabong said that the exclusivity period had been granted to allow the Naudé-Sycamore consortium to conduct a thorough earnings analysis.
As an alternative to the 60 cents a share cash offer, shareholders may opt to accept scrip in a new Sycamore affiliate to be incorporated for the purposes of making the bid (“NewCo”), with elections to bescaled back pro rata if total scrip elections exceed 24.9 percent ofNewCo shares.
The revised proposal is conditional on the proviso that scrip elections for at least 15 percent of Billabong shares are received and, additionally, on Billabongfounder Gordon Merchant and fellow board member Colette Paul placing their combined 16 percent stake in the company into the new Sycamore affiliate.
A Scheme Implementation Deed (SID) has also been negotiated with the Naudé-Sycamore consortium, with as yet no binding agreement.
According to the statement, “There is no guarantee that the proposed transaction will proceed and neither the Sycamore consortium nor Billabong is under any obligation to proceed with the proposed transaction unless and until each party determines, in its sole discretion, to execute and deliver a binding SID and proceed with the transaction."
Sixty cents a share was the higher — reportedly, by 10 cents — of two offers received by Billabong following protracted discussions with the Naudé-Sycamore and Altamont/VF Corp consortia in recent weeks.
In December, Naudé-Sycamore offered 1.10 Australian dollars, or $1.16 at December exchange — matched in January by Altamont Capital/VF Corp, which announced its intentions to break up the company if its bid was successful.
As predicted by analysts, however, both bids were eventually lowered following Billabong’s reporting, in February, of a 537 million Australian dollar net loss after tax, or $550.2 million at February exchange, for the six months to December 2012 — and then analyst speculation in March that the company’s equity value could ostensibly drop to zero by fiscal 2015 if earnings do not improve; which speculation coincided with a record 22 percent loss in sharevalue to an all-time low of 63 Australian cents.
Having been placed in a trading halt on two occasions in the interim, Billabong’s shares — which last traded at 73 cents (76 cents) prior to the Easter break — will resume trading immediately the company said.
Breaking: @cushnieetochs’ co-founders @carlycushnie and @ochsmichelle are parting ways. After a 10-year run, Ochs is leaving the brand. Get the full story on WWD.com – link in bio. #wwdnews #wwdfashion
@maybelline’s Kanako Takase had snow bunnies in mind when creating the beauty look for @philipppleininternational. Playing off of the bedazzled snowboards in the collection, Takase mixed two highlighters together for a luminous sheen. #wwdbeauty #nyfw (📷: @jilliansollazzo)
“There’s a huge gap between the old way of doing things and today. It takes the youth to help evolve that. You have to count on the kids today to help lead you into the future. A lot of these retailers are stuck in the past. Communication is the biggest thing,” said @ronniefieg of @kith on the youth’s role in retail. On Monday night, Jeff Staple moderated a keynote session with Fieg and @syresmith at Assembly - a series of workshops, talks and keynotes addressing topics or issues in the apparel industry. Head to WWD.com to read more advice from Fieg and what Smith thinks of his dad @willsmith’s Instagram account and sustainability (📷: @weston.wells)
@joansmalls closed the @michaelkors fall 2018 show in black sequined pants and a varsity T printed with 19 on the front and 81 on the back. 1981 – the year Kors went into business. #wwdfashion #nfyw (📷: @giovanni_giannoni_photo)
“You think your life is going to be a certain way, and nothing you thought would happen ends up happening. Never in my wildest dreams did I think I’d be designing clothes and working with Mickey Drexler, and building something I’m deeply proud of,” said Jenna Lyons. Nine months after leaving @jcrew, Lyons is exploring the meaning of happiness. Read the interview, where Lyons talks about reinvention and more on WWD.com – link in bio. #wwdfashion (📷: Farrell) #jennalyons #jcrew