Sponsors
Billabong ▲ +0.035 | PPR ▲ +0.20 | American Apparel ▲ +0.008 | The Buckle ▼ -0.07 | Columbia ▼ -0.49 | Deckers Outdoor ▼ -0.13 | Dicks ▼ -0.15 | Foot Locker ▲ +0.12 | Genesco ▼ -2.64 | Iconix Brand Group ▲ +0.13 | Jarden Corp ▲ +0.16 | Nordstrom ▼ -0.39 | Luxottica ▲ +0.57 | Nike ▼ -0.27 | Pacific Sunwear ▼ -0.22 | Skullcandy ▲ +0.09 | Sport Chalet - 0 | Urban Outfitters ▲ +0.02 | VF Corp ▲ +0.30 | Quiksilver ▼ -0.02 | Zumiez ▲ +0.20 | Macys ▼ -0.07 | Tillys ▼ 0.00 |
Ticker Sponsor
Readers Say
It pertains to my business
It pertains to my business

I’m an avid reader of Shop-Eat-Surf because it’s really the only online newsletter that I have found that is not only industry related, but also because it’s not so “guy-centric.” I find that a lot of the information I read on the site pertains to my business (as a swimwear designer) and keeps me up to date on what other companies and other women in the industry in general are doing which is not only inspiring but also helps me gauge the future direction of my business as well.

I feel privileged to read the Executive Edition because I know I am getting insider industry information before it hits the mainstream media channels. And it’s always good to know what my friends are up to in the industry.

- By Monica Wise, Founder, L*Space
Great insight into the issues
Great insight into the issues

I am a big fan of Tiffany and her team as well as an avid reader of Shop-Eat-Surf. I shop, I eat, I surf -- I should pay.

- By Kevin Bailey, President, Vans
Industry Insight

SIA SNOW SHOW: Early Bird rates thorugh Sept. 29 for Denver hotel rooms during 2015 show, from Jan. 28 - Feb. 3.

AGENDA: Video recaps, 2015 show dates, "Love Made Me Do It" women's networking series on Wednesday.

Details on Industry Insight.


Tiffany Montgomery
Print This Article

Zumiez bids for West 49

By Tiffany Montgomery
July 09, 2010 6:09 AM

Washington-based action sports retailer Zumiez is making a bid for Canadian retailer West 49 a week after Billabong announced is is acquiring the company.

Zumiez has offered to pay "an excess of $1.30 per share." Billabong's offer is for $1.30 for share.

However, West 49's board believes Zumiez bid could lead to a superior proposal. But, since Zumiez recently said it planned to expand into Canada, West 49 wants to "protect its competitive position."

According to a release, it will talk to Zumiez to determine if the offer can become a firm offer that is superior to Billabong's.

If Zumiez does that, West 49 says Billabong will have the right to match it within five days.

However, the board still supports Billabong's bid and believes it is in the best interest of shareholders, according to a statement.

Billabong has said it will finance the acquisition, valued at $99 million Canadian, with its existing credit facilities. At its last reporting period, Billabong had approximately AUS$225 million in net debt (cash minus short and long term borrowings).

West 49 said Zumiez offer is not subject to a financing condition either - meaning it would not need to obtain new loans.

Zumiez had $96.8 million in cash and no debt at the end of the last reporting period.

Zumiez had considered other acqusitions in the past few years. After Active Ride Shop filed for bankrutpcy in 2009, Zumiez explored buying the chain, and 20 of its stores (Active currently operates 21 stores). However, after conducting its due diligence, Zumiez did not make a formal bid during the final auction.

West 49 operates 138 mostly mall-based stores. Zumiez operates 389 mostly mall-based stores in the U.S.

Billabong owns approximately 372 stores around the world.

Read our previous interviews with Billabong North America President Paul Naude and West 49 CEO Sam Baio about Billabong's proposed acquisition of West 49.

Here is the release:

Burlington, Ontario, July 9, 2010 - West 49 Inc. (TSX: WXX) (the "Company"), Canada’s leading action sport retailer, today announced that Zumiez, Inc., a U.S.-based action sports retailer, has advised the Company that, subject to a satisfactory due diligence review in its sole discretion, it “would be prepared to make an offer, that would not be subject to a financing condition, to acquire all of the outstanding common shares and preferred shares of West 49 for a cash price in excess of C$1.30 per share”. Zumiez, Inc. has further indicated that it believes that its acquisition proposal would reasonably be expected to lead to a superior proposal, and has indicated that it would like to enter into a confidentiality and standstill agreement with the Company.

The Company’s board, after consultation with its outside legal and financial advisors, has concluded that the Zumiez proposal would reasonably be expected to lead to a superior proposal. However, the Company is concerned with Zumiez’s previously stated intent to enter the Canadian market, and therefore the board has instructed the Company’s management to seek to protect the Company’s competitive position. Subject to the terms of the existing agreement with Billabong International Limited, the Company’s special committee intends to seek to negotiate with Zumiez to determine if its offer can become a firm offer that is financially superior to the transaction with Billabong and that West 49 can otherwise treat as a superior proposal under the terms of the existing agreement with Billabong. There can be no assurance that Zumiez will in fact make a firm proposal or, if it does, as to the price, terms or conditions thereof. In the event that Zumiez does make a proposal that the board determines constitutes a superior proposal which the Company wishes to accept, Billabong would have the right, but not the obligation, to match such proposal within a 5 business day period.

The special committee and the board as a whole confirm that they continue to support the Billabong transaction and confirm their unanimous conclusion that the transaction with Billabong is in the best interests of the Company and is fair to the Company’s securityholders and their recommendation that securityholders vote in favour of the Billabong transaction, under which the Company’s common shares and preferred shares would be acquired at C$1.30 per share. The agreement with Billabong remains in effect at this time. Further details of the Billabong transaction are expected to be included in a proxy circular to be mailed to shareholders in due course.


Articles You Might Have Missed