Reuters – Pacific Brands, KKR and Other Parties End Buyout Talks

Australian underwear manufacturer Pacific Brands said takeover talks with parties including KKR have ended without an offer being made, according to Reuters. KKR made a buyout approach to Pacific Brands in January that local reports said could be worth $614 million.

Reuters – Australian underwear manufacturer Pacific Brands (PBG.AX) said on Tuesday that takeover talks with parties including KKR & Co (KKR.N) have ended without an offer being made, and confirmed a weak sales and profit outlook.

Private equity giant KKR & Co made a buyout approach to Pacific Brands in January that local reports said could be worth $614 million. Pacific Brands said after the approach it had also received other enquiries.

“Having explored these enquiries, the board of Pacific Brands has concluded that a definitive proposal for the acquisition of the entire issued capital of the company is unlikely to be forthcoming in the near term,” the company said in a statement.

The talks with Pacific Brands, the maker of Bonds underwear, Berlei bras and Sheridan sheets, sent a signal that many cyclical businesses, including retailers, were trading at such low levels they were attractive to private equity.

A source told Reuters in February that rival global private equity firm TPG Capital TPG.UL had held initial discussions with a group of eight banks to fund a takeover bid for Pacific Brands.

Pacific Brands on Tuesday reaffirmed its outlook that earnings and net profit before one-off items are expected to be materially down in the second half, compared with the first half, due to weak retail conditions.

(Reporting by Victoria Thieberger; Editing by Richard Pullin)