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Monday, Mar 18, 2024
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Billabong Bows Out of Sale Talks

Australia-based Billabong International Ltd. said last week it had broken off talks with private equity firm TPG Capital Partners LP after the two were unable to agree upon a price for the apparel company.

Billabong, which owns Irvine-based Billabong USA, makes clothes and accessories branded as Billabong, Element and RVCA, among others.

Fort Worth, Texas-based TPG first offered $825.3 million and more recently $909.2 million to acquire the company. Billabong rejected both offers.

Billabong directors Gordon Merchant and Colette Paull—both substantial shareholders in the company—notified Billabong prior to its formal rejection of TPG’s latest offer that they opposed accepting the bid. Merchant is the founder of Billabong; Paull was an early employee. In a letter they refused to “assist or facilitate a proposal by TPG Capital to commence due diligence on Billabong, even if the price TPG offered was $4 [Australian] per share.”

Such a per-share valuation would mean a $1.1 billion offer in U.S. dollars. Billabong said it remains open to discussions with other bidders and would be open to considering resuming talks with TPG.

—Kari Hamanaka

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