Billabong International Limited has reached in-principle an agreement to acquire its licensed business in South Africa. The business comprises a wholesale distribution channel (and associated outlet store) and small-scale manufacturing facilities.
The purchase is subject to a number of conditions precedent, including South African Reserve Bank and anti-trust approvals and satisfactory due diligence. It is expected the South African business will contribute approximately 2% of the Billabong groups projected full year revenue in the 2007-08 financial year.
The purchase, which is expected to be completed within one month and was effective July 1, 2007, is forecast to be EPS-positive in year one.
