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Volume 6 No. 212


Private equity firm Bain Capital is the "mystery bidder" behind a A$694.5M ($710.9M) takeover proposal for surfwear retailer Billabong, which matches an existing offer from fellow private equity firm TPG, according to THE AUSTRALIAN. Billabong "didn't identify a new bidder that has made a non-binding cash offer" worth around $1.45 a share, the same price offered by TPG in July. Bain's bid comes at a time when Billabong is trying to turn around a business that has "swung to a loss as customers desert its brands for rival makers of surf wear and ski apparel, and fragile consumer sentiment and a strong Australian dollar weigh on revenue." Taking the same stance as it did with the recent TPG bid, Billabong said that "it didn't believe the competing offer matched its fundamental value." The company added, however, that it would "grant the new party due diligence on a non-exclusive basis." Watermark Funds Management Senior Analyst Tom Richardson said that "competitive tension" in the bidding process would likely bring about "a higher price for shareholders" (THE AUSTRALIAN, 9/6).

NO GUARANTEES: In Sydney, Colin Kruger reported that Billabong shares were trading 10 cents higher at $1.37 after Bain's takeover proposal was announced. There is "no guarantee" a party will make a formal offer for the company after due diligence. If they do, it is not certain if they will match their $1.45 indicative bids. Billabong said, "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." It said that the process is expected to take several weeks (SYDNEY MORNING HERALD, 9/6).

If the Indian Premier League's Deccan Chargers do not get a buyer by Friday, the Board of Cricket Control in India will "float a tender to find a replacement for the crisis-hit franchise," according to TNN. The board sent a letter Tuesday to Chargers owners asking them "to close a deal with a prospective buyer" by Friday. BCCI currently has no plans to have a base price for the team if it is forced to float a tender, as it would "encourage more bidders for the franchise." ICICI Bank, which has given a loan of Rs 4.8B ($86.4M) to Chargers, has formed a consortium with Yes Bank -- which has loaned the franchise Rs 1.7B ($30.6M) -- and another private bank. The consortium has told the BCCI that if Chargers fail to find a buyer, they are "keen on running the IPL team for at least a year" and then deciding on its future (TNN, 9/6). The PTI reported that Deccan Chronicle Holdings Limited "issued a tender notice inviting bids from prospective buyers" for Chargers. The tender notice said, "Under this invitation to tender issued by DCHL, the winning bidder will acquire from the DCHL on an 'as is where is' basis the right to own and operate the IPL team currently known as Deccan Chargers, which is and will continue to be based in Hyderabad and which competes in the Indian Premier League and which has the opportunity (if applicable and subject to qualification) to compete in each and any CLT20, which is staged from 2013 onwards". The term "as is where is" means that the new buyer will "have to use the name Deccan Chargers and will have to clear the liabilities of the current owner" (PTI, 9/6).