Affiliates of an investment firm that has vowed to oust most of Billabong International Ltd’s board of directors boosted its holdings in the company in late September.

According to an Oct. 4 filing with the Australian Securities Exchange, Coastal Capital International, Ltd. and its affiliates invested another $1.3 million and now control 7.59 percent of Billabong’s shares, up from 6.24 at the time of their last filing Sept. 3.


Coastal Capital has accused Billabong's board of presiding over the worst destruction of shareholder wealth in Australian history. On Sept. 3, it notified Billabong that it would try to oust all its directors except founder Gordon Merchant and Colette Paull, whose significant holdings of Billabong stock closely align their interests with those of shareholders.



Coastal Capital said it will seek shareholder approval of its own nominees to Billabong’s board as well as an amendment to the company’s bylaws to require shareholder approval of all future debt and equity issues. Billabong turned down Coastal Capital’s request for a special shareholder meeting but has said it will seek to include its resolutions on the agenda of its annual shareholder meetings, which is scheduled for November.


Billabong’s board announced Sept. 19 that three of the directors Coastal wants to oust will resign at that meeting to make way for three directors being nominated by Oaktree Capital Management and Centerbridge Partners (O/C Consortium), which outmaneuvered an investment group led by Altamont Capital Partners to win the rights to recapitalize Billabong.  That would leave two directors Coastal wants removed still on the board. Coastal said in early September that it favored the O/C Consortium’s refinancing package over Altamonte’s, indicating it will vote to approve its nominees.


Billabong’s board said that it eventually plans to transition to a seven-member board that will consist of Merchant, Paull, its newly appointed CEO Neil Fiske, two members from the O/C Consortium and a person to be named later.