Northern,WI  3/20/2013 (BasicsMedia)  — Australian surfwear brand and takeover target Billabong International Ltd (BBG.AX) droped more than 20 percent  on Thursday with concerns on the status of two rival bids for the company.  Billabong, which has been struggling with big losses, has been in talks with Both private equity firm Altamont Capital Partners, and clothing group VF Corp (NYSE:VFC). Due diligence on the bids, pitched by both groups at $1.10 a share expected to be completed by the end of March. Shares in Billabong, whose brands include Billabong as well as Von Zipper and Element recently sank to an all-time low.

“This one has got people concerned, we’ve seen four bids already that have all been withdrawn at the due diligence stage,” said Michael McCarthy, chief market strategist, CMC Markets. “The market had more confidence around these bids because they’re coming from company insiders, who the market felt would be less likely to fall away in the due diligence process, but the market is obviously nervous ahead of this announcement.” Billabong said the halt was needed in order to  “investigate the reason for the trading levels”, without providing any further detail.

The company had a turbulent  2012, alienating investors after rejecting a bid by TPG Capital (TPG.UL) in February as too low. Subsequent offers from TPG and Bain Capital were withdrawn after due diligence.

Disclaimer I have no position in the companies mentioned in this article.

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