(MENAFN - AFP) Australian surfwear brand Billabong on Thursday appointed a new director and accepted a refinancing deal worth more than US500 million from US investment firms Centerbridge Partners and Oaktree Capital Management.
Billabong, which in August posted a Aus859.5 million (US771.7 million) annual net loss, said the new deal was superior to one agreed with US private equity firm Altamont in mid-July, which would have resulted in former Oakley boss Scott Olivet becoming CEO.
It said "the board determined that the C/O (Centerbridge/Oaktree) consortium proposal was in the best interests of the company, its shareholders, its employees and other key Billabong stakeholders, on both economic terms and in providing near-term certainty".
The Centerbridge and Oaktree deal offers cheaper debt, more upfront cash and less dilution for its existing shareholders, it said.
Under the deal Neil Fiske, a former chief executive of US outdoor clothing company Eddie Bauer, now holds the daunting task of turning Billabong around
"Neil is a passionate outdoorsman with a proven record of turnarounds and is very enthusiastic about the Billabong portfolio of brands," Billabong said.
The ailing firm has been the subject of multiple failed takeover bids, with its shares hitting a record low of 12 cents in June as it battled a prolonged rally in the Australian dollar and muted consumer confidence in its key US and European markets.
In July it entered into a US470 million refinancing deal with Altamont and GSO Capital partners, including a US294 million loan, a share issue and an asset-based credit facility from GE Capital.
The new agreement involves Billabong using funding provided by Centerbridge and Oaktree to repay the loan. It also involves issuing new shares and options to Centerbridge and Oaktree that will result in the pair owning up to 40.8 percent of Billabong's stock.
Billabong shares closed 5.56 percent higher at 47.5 cents.