Billabong further advised on Friday, 27 July 2012 that, subject to negotiation of an appropriate confidentiality agreement, TPG would be granted the opportunity to conduct non-exclusive due diligence in order to reduce the conditionality of its proposal and to improve its understanding and valuation of Billabong.
The Board also advised that it does not believe that TPG's proposal reflects the fundamental value of Billabong in the context of a change of control transaction. A confidentiality agreement has subsequently been agreed with TPG and its due diligence has commenced.
The Board of Billabong announces that, following the close of trade on Wednesday, 5 September 2012, it received an indicative, nom-binding and conditional proposal from another party interested in acquiring all of the shares in the company and which states "we currently propose a cash consideration value of around $1.45 per share".
The proposal is subject to due diligence and conditional on a number of other matters equivalent to those in the TPG proposal. A confidentiality agreement with this party has also been agreed. As such, the Board of Billabong has concluded that it will also grant this party the opportunity to conduct non-exclusive due diligence in order to reduce the conditionality of its proposal and to improve its understanding and valuation of Billabong. As is the case for TPG's proposal, the Board does not believe that this proposal reflects the fundamental value of Billabong in the context of a change of control transaction.
The Board of Billabong now considers that the interests of shareholders will be best served by a formal process to thoroughly evaluate whether a change of control offer, at a price and on terms that the Board would recommend, ca n be secured.
In order to ensure that the process operates as effectively as possible, the Board does not intend to make any further announcements unless and until a recommended offer is secured, or unless there is a development which it considers requires disclosure. This process is expected to take several weeks.
The Board of Billabong reiterates there is no guarantee that,following this process, a transaction will be agreed or that the Board will recommend any proposal.
Billabong has established and grown many of the leading brands in the global board sports market. Those brands, which include Billabong, RVCA, Element and DaKine among many others, are internationally recognised and globally distributed. On Monday, 27 August 2012, Billabong announced its Transformation Strategy which provides a clear pathway to unlocking the inherent value within the company.
In any control transaction, the Board of Billabong will seek to ensure that the medium to long-term prospects of the company and its unique brands are reflected in the value realised by Billabong's shareholders.
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