April 4, 2013

Paul Naude Frontrunner In Billabong Talks

The Financial Review is reporting that Paul Naude backed by Sycamore Partners is the frontrunner in the bid to buy Billabong. They are reported to be looking at 73c a share, over 30% off their initial indicative price of $1.10. This values the company at $349.6 million, a far cry from the $850 million figure that TPG was putting out last year.

The rival bid from VF Corp apparently has a few additional conditions attached to it, like needing more time to firm up the offer. They came to the process a little later than Naude’s group. However their offer is also rumored to be significantly lower than $1.10.

According to Business Spectator, the shares are likely to remain on a trading halt as Billabong directors try and negotiate up the price. Analysts have said that a deal is almost certain due to the financial situation of the company. Were a deal not to happen, The Australian reported that “Billabong would be forced to raise significant capital — about $100m — to repair its balance sheet.”

For more on this, here’s a few links:

Business Spectator – Billabong suitors slash offer

The Australian – Takeover crucial to salvaging Billabong

AFR (Subscription required) – Naude in front for Billabong

by POP Magazine