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Billabong ends takeover talks with TPG

by Laura Board | Published February 28, 2012 at 10:30 AM

Billabong said it "has an attractive independent future," that its brands are "world renowned and highly valued" and that a strategic review has put it on a "much more secure footing."

Billabong agreed on Feb. 17 to sell just under half of surfing and snowboarding accessories maker Nixon Inc. to Trilantic Capital Management LLC in a deal that put an enterprise value of $464 million on Nixon.

Billabong's other brands include Element, VonZipper, Honolua Surf Co. and Tigerlily.

TPG swooped in after the appreciation of the Australian dollar and weak trading in Europe and Australia hurt Billabong's sales and profit, hammering its shares. The buyout firm's proposal was contingent on Billabong's not selling additional assets, as well as due diligence and financing.

Announcing the outcome of a strategic review, Billabong earlier this month said it would close up to 150 of its 677 stores and implement other cost-cutting measures

For the six months ended Dec. 31, revenue rose 1.5% to A$847.2 million, about 47% of which came from the Americas. First-half Ebitda declined almost 22% to A$74.1 million.

As of Dec. 31, net debt was A$525.6 million. Billabong is led by CEO Derek O'Neill and is based in Burleigh Heads, on Australia's Gold Coast.

Billabong is taking advice from Goldman, Sachs & Co. and law firm Allens Arthur Robinson.

Nonexecutive directors Merchant and Paull took advice from Bruce Cowley at law firm Minter Ellison.

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Billabong ends takeover talks with TPG

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