Billabong shares plummet over 43% after takeover talks fail: Midday roundup

Billbong’s takeover talks have finally come to an end with no outcome achieved, following months of discussions which has seen the value of the company drop significantly.

Shares for the company plummeted after the trading halt was removed this morning, falling 43.96% just before midday to $0.255.

The company is now valued at just $100 million, down from the $220 million offered in the dealEconomy to private equity groups Sycamore Partners and a consortium involving the firm Altamont Capital.

The troubled surfwear retailer is now discussing possible debt deals and asset sales after takeover talks with the interested parties fell through.

Discussions are now being held with the same companies about possible refinancing and asset sales, with the proceeds of any deals to be used to repay Billabong’s debts.

Warren Buffett cleared to buy Heinz

Billionaire Warren Buffett’s investment company Berkshire Hathaway and Brazilian-led 3G Capital have been granted permission from the European Commission to purchase food company Heinz.

The takeover will cost a hefty $29.3 billion and the move was cleared on Monday as the commission found the acquisition would have no impact on competition in the European market.

When the deal was announced in February, Buffett said the global success of Heinz was a testament to the power of investing in strong brand equities.

He said Heinz has “strong sustainable growth potential based on high quality standards, continuous innovation, excellent management and great tasting products”.

Shares open steady

The Australian share market has opened flat this morning ahead of the Reserve Bank’s rate decision later this afternoon.

The S&P/ASX 200 benchmark was up 7.3 points just after midday to 4895.6.

The Dow Jones closed 0.92% higher last night, up 138.46 points to 15,254.03.

While the market has remained steady Australian dollar has rebounded slightly against the greenback, currently trading at around $0.98 to the US dollar.


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