Shareholders bail Billabong vote

THE owners of surf brand Quiksilver have moved to calm the market as shares in their takeover target Billabong dropped as much as nine per cent this morning.

California-based Boardriders Inc flagged a $1 per share offer for Billabong in December, with an independent review backing it in a scheme booklet last month

Shareholders are set to vote on the arrangement on Wednes- day, but there have been media reports the vote may falter.

Billabong shares were trading at 79c before the proposal was announced and had hovered around 96c since, adding more than $39 million to the company’s market capitalisation.

Yesterday morning they traded as low as 86.5c.

In an announcement to the market, Boardriders reaffirmed their commitment to rebuilding the struggling brand.

“Boardriders has actively pursued a combination with Billabong because its brands, business, and people are natural complements to the Boardriders platform,” the statement said.

“The Boardriders and Billabong teams have worked for many months to define the transaction and future structure, and believe this plan will best position all of our brands to thrive in the future.”

Boardriders CEO Dave Tanner said combining the companies made sense.

“I passionately believe in the action sports industry and the Boardriders and Billabong teams, and that this transaction represents the best value for all stakeholders – shareholders, employees, vendors and customers,” he said.

“The combined entity will have greater ability to strengthen and advance the action sports industry in a unique and meaningful way. We are excited to welcome the Billabong team to the Boardriders community and look ahead to what the combined company can achieve.”

The transaction is expected to close around April 24 if approved, Boardriders said.

Billabong’s board, including founder Gordon Merchant, support the buyout which has also been backed by an independent review and proxy advisers.

Boardriders is majority owned by funds manager Oaktree Capital, which already holds 19 per cent of Billabong shares and is a major lender to the company.