Billabong receives proposal from TPG

The Board of Billabong announced that it received an indicative,

non-binding and conditional proposal from TPG International LLC (TPG) to acquire all of the shares in the company for $1.45 (Rs 81) cash per share by way of a scheme of arrangement. TPG’s indicative price of $1.45 (Rs 81) per share is based solely on available public information and may be refined with the benefit of due diligence.

TPG’s offer is based on 479 million shares on issue, representing total Billabong shares post the entitlement offer (previously 258 million), as well as reflecting Billabong’s trading update and estimated net debt position announced on 21 June 2012 of approximately $100 million (Rs 559 crores) post receipt of the final entitlement offer proceeds ($325 million (Rs 1,818 crores) pre receipt of the final entitlement offer proceeds).

The proposal is subject to due diligence and conditional on a number of other matters which include entry into a mutually agreed scheme implementation agreement. TPG has advised that Colonial First State Investment Limited (Colonia l) and Perennial Value Management Limited (Perennial) have agreed under conditional share sale agreements, to sell to TPG, in aggregate; approximately 12.5 percent of Billabong’s issued capital post the allocation of shares under the current retail entitlement offer (equates to approximately 14.5 percent of Billabong’s current issued capital).

TPG’s proposal allows Billabong’s founding shareholder, Gordon Merchant, and Colette Paull to roll all or part of their respective share holdings in the company into the TPG proposal. The decision by Merchant and Paull to rollover or not, will not alter t he remaining terms of the proposal. Goldman Sachs is acting as financial advisor and Allens is acting as legal advisor to Billabong.

Founded in 1992, TPG specializes in deep investment. Its investments span a range of industries including financial services, travel and entertainment, technology, industrials, retail, consumer products, media and communications, and healthcare.