AUSSIE surfwear group Billabong has fallen into foreign hands after being snapped up by the company behind rival Quiksilver in a $200 million deal.
The directors of Billabong have formally swung their support behind the buyout offer from Boardriders, the Californian company that owns Quiksilver.
Billabong earlier last month announced it had received a buyout offer from Boardriders, which is in turn owned by Los Angeles-based private equity house Oaktree Capital Management.
At the time, the Gold Coast-based company announced it had opened its books for scrutiny by the group.
Oaktree already owns a 19 per cent stake in Billabong. It snared more than 90 per cent of Quiksilver shares in 2016 and took that company off the stockmarket as part of a refinancing deal.
Boardriders has agreed to pay $1 in cash for every Billabong share, valuing the Aussie company at $198.1 million.
That offer is a 28 per cent premium to the closing price of Billabong shares on November 30, the day before the deal was announced.
It gives Billabong an enterprise value - a figure that also includes its debt - of $380 million.
When Billabong announced the approach on December 1, company secretary Tracey Wood said the due diligence process was "likely to take a number of weeks".
Announcing their support for the buyout bid today, Billabong directors recommended shareholders back the deal.
Chairman Ian Pollard said that if a deal were not done, Billabong shareholders faced "ongoing risks and uncertainties associated with the business".
"These include risks relating to the state of the global retail market," Mr Pollard said.
Billabong would likely have to cut its debt if it was to continue as an independent company, he said.
As a result, the group would likely have to sell assets or tap shareholders for extra cash.
Billabong chief Neil Fisk said in a statement that the great strength of Billabong was the "authenticity and heritage" of its brands.
"I'm confident those qualities will not simply be protected but enhanced by a new organisation that will have the scale and financial security to continue to support and build them as we enter into a new and dynamic retail environment," he said.
Investment bank Goldman Sachs is advising Billabong on the deal.
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