Surfwear giant Billabong has confirmed the worst kept secret - that it is the subject of a $527 million takoever bid - and scrambled to deal with the potentially damning breach of confidentiality.
In a statement to the Australian Securities Exchange, Billabong revealed it will meet with a consortium led by former executive Paul Naude to discuss the validity of the offer.
The $1.10 per share takeover bid was confidential and non-binding.
One of the conditions of the bid was that if its confidentiality was lost for any reason, it would be withdrawn with immediate effect.
As a result, the company will meet with the consortium, which includes New York-based Sycamore Partners and Bank of America Merrill Lynch.
The parties will also discuss Billabong's downgraded earnings forecast, which was initially estimated at $100 and $110 million for the full year before interest, tax, depreciation and amortisation.
However, the forecast has since been cut to between $85 million and $92 million, excluding significant items which are expected to factor in at around $29 million.
Once included, the forecast drops to $56 to $63 million.
Billabong: Bumpy road.
