Boardridden Buys Iconic Surfwear Brand Billabong

Australian iconic surfwear brand Billabong International Ltd agreed to a buyout from majority shareholder and lender Oaktree Capital Management LP on Friday. The deal values the company at about A$197.7 million (US$155 million).

Australian iconic surfwear brand Billabong International Ltd agreed to a buyout from majority shareholder and lender Oaktree Capital Management LP on Friday. The deal is through Oaktree’s majority controlled Boardriders Inc, formerly known as Quicksilver. 

Surfing Lisa ANDERSON

Pic: US Surfing legend Lisa Anderson

The deal values the company at about A$197.7 million (US$155 million). 

Oaktree adds Billabong to a cluster of sports and youth brands. The Billabong success story was of a Australain brothers that took their brand to the height of the surfing world and surfwear. Unfortunately their success brought an aggressive bricks and mortar expansion on the heals of the 2008 GFC. With that the company has fought for survival.

Oaktree is an American private equity firm that has funded the diffcult survival period, owning 19% equity currently and Billabong’s major lender. The company owed Oaktree and Centrebridge A$172.2 million as at 30 June, according to the company’s annual report. 

The firm is adding Billabong and its brands into a larger exciting portfolio, believing cost savings and economies of scale will benefit the different groups. Boardriders, roughly 85 percent controlled by Oaktree, said its purchase would complement these existing brands, allow for “deeper” partnerships with suppliers and back-office savings.

Oaktree Portfolio After Billabong Buyout

  • Billabong
  • RVCA
  • Element
  • Von Zipper 
  • Quicksilver
  • Roxy
  • DC Shoes.

In 2013 Oaktree, along with Capital Management LP were the saviors of Billabong with a refinancing deal. The turnaround has been difficult and falied to get traction along with most companies in the retail space. Billabong posted a A$77.1 million post-tax loss last year.

The Bid Price

The bid price of A$1 per share represents a premium of 4.2 percent to Billabong’s closing price on Thursday and a 28.2 percent premium to the stock price before the offer was announced on Dec. 1, 2017.

Billabong directors unanimously recommended the offer and shares jumped 2.86 percent to trade at A$0.99 in afternoon trade. The buyout is subject to shareholder and regulatory approval. Boardriders expects it will complete in the first half of 2018 and said the combined entity will be led by Oaktree Managing Director Dave Tanner.

Source: Billabong

From a sunburnt country ….

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