This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

The Deal: Centerbridge, Oaktree Make New Run at Billabong

NEW YORK ( The Deal) -- Investors Centerbridge Partners and Oaktree Capital Management (OAK - Get Report) Friday, Aug. 23, returned with a rival refinancing proposal for Australia's Billabong International, which they claim offers greater value for the struggling board sports clothing and equipment group and its shareholders.

The partners, which hold senior debt in Billabong, have been racing to overturn a $748 million financing package led by Altamont Capital Partners and including Blackstone Group's (BX - Get Report) GSO Capital Partners ever since a July 16 agreement. On Tuesday they won a partial victory when Australia's Takeovers Panel forced Altamont to amend the terms of the package, removing a punitive temporary interest rate on part of the debt and a $65 million payment due in the event of a change of ownership at Billabong.

Centerbridge and Oaktree said their new proposal "provides the board with greater flexibility for addressing the company's near and long-term capital and operational needs when compared to the revised Altamont and GSO proposal." They also said they had lined up potential CEO candidates to head Billabong if former Oakley Inc. CEO Scott Olivet, who was due to join under the Altamont plan, is unavailable.

Billabong corporate affairs executive Chris Fogarty Friday declined to comment on the revised proposal pending a statement from the company. Billabong shares were up 6.8% at A$0.59 by late afternoon in Sydney.

Billabong in July had insisted that Centerbridge and Oaktree's original offer came too late because it had already signed a binding deal for a bridge facility from Altamont along with an agreement to sell the Dakine clothing brand to the San Francisco investor. Billabong said Wednesday it expects to sign binding documentation on a revised term loan worth up to $310 million from Altamont and GSO within two to three weeks; Oaktree and Centerbridge said Friday they wanted to present their alternative before that happened.

Centerbridge and Oaktree said their proposal would save Billabong up to between A$119 million and A$143 million ($107.1 million and $128.7 million) in interest payments over five years and represented an 81% premium for the 39.7% equity stake they plan to take in Billabong compared with the Altamont proposal. That deal could give Altamont and GSO an eventual holding of about 40.5%.

1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Try it NOW
Only $9.95
Try it NOW
14-Days Free
Try it NOW

Check Out Our Best Services for Investors

Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
Try it NOW
Try it NOW
Try it NOW
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
SYM TRADE IT LAST %CHG
BX $37.98 1.10%
OAK $51.61 -0.46%
AAPL $123.04 -0.97%
FB $83.52 0.62%
GOOG $550.91 -0.77%

Markets

DOW 17,686.54 +8.31 0.05%
S&P 500 2,058.85 +2.70 0.13%
NASDAQ 4,881.0770 +17.7150 0.36%

Partners Compare Online Brokers

Free Reports

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs