Billabong International Ltd. entered into an agreement to sell West 49, the Canadian action sports chain which operates 92 stores, to YM Inc.. for C$9 to C$11 million. YM operates Stitches, Urban Planet, Sirens, Siblings, Suzy Shier and Bluenotes in Canada
As part of the deal, the two parties have also entered into an initial two-year supply agreement.
Billabong said it continues to work with GE Capital to provide an asset-based multi-currency revolving credit facility of up to $100 million. This has been reduced from up to $140 million in part due to the sale of West 49. Along with retaining six Billabong stores and two Element stories in Canada, Billabong has also entered into an around C$34 million non-exclusive wholesale agreement with YM over the next two years.
Neil Fiske, CEO of Billabong, said, “The sale of West 49 is part of our broader strategy of simplifying our business and focusing on the core of what we do best, which is building strong global brands. The supply agreement we've entered into ensures our products will continue to have a strong presence for consumers in that market.''
Further, Billabong said a $300 million tranche of the 6 year senior secured term loan of $360 million provided by entities affiliated with Centerbridge Partners, L.P. and Oaktree Capital Management, L.P. funded on November 1.
The proceeds of the funding were applied to repay in full the $294 million bridge loan facility from the Altamont Consortium which was entered into on July 16, together with accrued interest and fees.
Read more: http://www.nasdaq.com/article/billabong-agrees-to-sell-canadian-retail-chain-west-49-to-fashion-retailer-ym-20131103-00029#ixzz2jjXxD1l7
