PUBLISHED: 8 hours 37 MINUTES AGO | UPDATE: 8 hours 11 MINUTES AGO PUBLISHED: 11 Oct 2012 PRINT EDITION: 11 Oct 2012
Billabong management has stepped up its efforts to win over private equity suitor TPG, but it appears to be a case of too little, too late.
The surfwear company’s shares closed under $1 for the first time in 3½ months yesterday, dropping 3¢ to 99.5¢. As reported by this newspaper last week, TPG has expressed its concern about Billabong’s earnings forecasts and the strength of its core brand and has considered walking away.
The report that TPG might withdraw – and Billabong’s confirmation of the concerns – prompted Billabong shares to drop almost 25 per cent.
With that in mind, and as some of Billabong’s largest shareholders still cling to the hope of a deal, it is not surprising Billabong management is working hard to clear up TPG’s doubts in one final attempt to cut a deal.
It’s believed Billabong has returned to the table with more data and held further conversations with the Ben Gray-led private equity group. Due diligence started roughly six weeks ago and will soon draw to a close.
It remains to be seen whether the significant differences can be overcome. The market is firmly of the view that this deal is all but over.
TPG appears to be Billabong’s last hope of securing a successful deal after Bain Capital withdrew last month.
Elsewhere, it’s been a rough year but that’s not stopping the 15th annual equity capital markets dinner from being held tonight in aid of the Cathy Freeman Foundation.
It’s Credit Suisse’s turn to organise the event, which will see 100 or so bankers descend on Sydney’s Tea Room in the Queen Victoria Building. CS has secured sports broadcaster Hamish McLachlan as master of ceremonies and swimming legend Ian Thorpe is also expected at the function
Finacial review
BBG Price at posting:
82.6¢ Sentiment: None Disclosure: Not Held
