BOTH BIDS STILL ON, SAYS BILLABONG

BOTH BIDS STILL ON, SAYS BILLABONG

BILLABONG'S (ASX: BBG) shares regained some ground this morning after the surfwear group quashed rumours that potential takeover offers for the company were at risk of being withdrawn.

The embattled Gold Coast group last night confirmed that two indicative bids from US-based private equity firms are still in “process”.

The indicative bids, which are still understood to be in the due-diligence phase, value the company at $527 million, or $1.10 a share.

But speculation is mounting that the final bids, due next week, could be much lower than that.

Investors this morning remained cautious, although they helped Billabong claw back some of yesterday’s lost ground.

Billabong’s shares slipped to an all-time-low of 63c yesterday before closing at 69.5c ahead of a trading halt requested by the company in order to get to the bottom of the speculation surrounding the potential takeover bids.

After the trading halt was lifted this morning, the shares climbed 10 per cent to 77c in early trade following Billabong’s assurance that neither bidder had withdrawn from the process.

But they fell back later, trading just above yesterday’s close in the late morning session.

Billabong yesterday blamed a speculative report printed in the Australian Financial for its share freefall.

Billabong investors are pinning their hopes on firm takeover offers coming from either or both parties next week.

One bid team is headed by Paul Naude, the long-time boss of Billabong’s American operations, who is working with private equity firm Sycamore Partners to secure control of Billabong.

The other is US clothing giant VF Corporation and Altamont Capital Partners, who in recent weeks have been seen as wavering in their desire to proceed with a bid.

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