Surfwear giant Billabong says TPG Capital's revised $904 mn bid still too low
28 Feb 2012
Struggling Australian surfwear giant Billabong International, yesterday said that private equity firm TPG Capital has raised its takeover offer by 10 per cent to $904 million, but the price is still too low.
Billabong said in a statement that the sweetened A$3.30 a share offer still did not reflect the value of the company and, "As a result, discussions between the two parties have ceased."
Texas-based TPG Capital, which has $48 billion of capital under management, had on 12 February made a preliminary offer of $3 per share or A$765 million ($820 million) to debt-laden Billabong. (See: TPG Capital tables $820-mn bid for Australian surfwear giant Billabong)
TPG Capital's latest revised offer values Billabong at A$841 million ($904 million). Billabong market capitalisation a year ago was around A$3.3 billion.
Billabong yesterday reiterated that Gordon Merchant, the company's founder and largest shareholder with a 14.8-per cent stake, said in a letter to the board he would not accept an offer from TPG even if it were A$4 per share, since that would still represent a discount to true value.
Billabong, based in Australia's Gold Coast, has debt of more than A$500 million, of which, A$484 million is due in 2013 and the remainder matures in 2014.
