SYDNEY — TPG Capital has launched a fresh takeover offer for troubled surfwear brand Billabong International Ltd.
This story first appeared in the July 25, 2012 issue of WWD. Subscribe Today.
The Gold Coast, Queensland-based company said in a statement to the Australian Securities Exchange on Tuesday morning it had received an indicative, nonbinding and conditional proposal from TPG Capital to acquire all the shares in the company in an offer that values Billabong at 695 million Australian dollars, or $716 million.
According to the statement, Billabong’s major shareholders — Colonial First State Investment Ltd. and Perennial Value Management Ltd. — have agreed to sell to TPG Capital about 14.5 percent of Billabong’s shares — not precluding a transaction at a higher price, with TPG expected to file a substantial shareholder notice shortly.
Billabong declined further comment but a company representative confirmed that a further announcement will be made in the coming days.
Tuesday’s proposed price comes in at 1.45 Australian dollars, or $1.49, a share. Billabong’s shares trade at about 1.32 Australian dollars, or $1.36 at current exchange.
The offer comes five months after Billabong rejected three offers from TPG Capital within the space of a week, the last for 3.30 Australian dollars, or $3.53 at February exchange rates. At the time, Billabong founder, non-executive director and major shareholder Gordon Merchant said he wouldn’t consider any offers under 4 Australian dollars.
Merchant’s rejection of the initial TPG offer and a subsequent profit warning have put the surfwear company’s shares under extreme pressure. In June, Billabong’s shares fell to a record low of 92.5 Australian cents — or 93 cents at exchange rates of the period — reigniting takeover speculation, with TPG Capital, Nike Inc. and PPR among the names rumored to perhaps be interested.
Billabong’s shares closed Tuesday at 1.32 Australian dollars, or $1.35, up 21.5 cents, or 19.6 percent.