US private equity firm Altamont Capital Partners has taken effective control of embattled surfwear retailer Billabong by taking over the company's debt and ousting its chief executive Laura Inman.
Altamont's two founding partners will join Billabong's board under the deal, which will see private equity firm take a stake of up to 40% of the group in exchange for $325 million in debt refinancing. Billabong's board has agreed to sell the bag and outerwear business, Dakine, to Altamont for $70 million.
As a condition of the deal CEO Laura Inman is to leave the company and will be replaced by Scott Olivet, the former CEO and Chairman of sunglass and sportswear giant, Oakley.
The news came as Billabong emerged from a trading halt after extended talks on asset sales and refinancing options with Altamont and alternate suitor Sycamore Partners.
"This financing package is intended to provide Billabong with a flexible capital structure to allow it to stabilise the business, address its cost structure, and pursue a strategy to grow the business," the group said.