Pacific Brands
(ASX:PBG) shares soared 15 per cent this morning after it said it is in preliminary talks with US private equity giant Kohlberg Kravis Roberts(NYSE:KKR), after receiving a buyout approach.
The deal is believed to be worth $614 million.
Pacific Brands says there’s no certainty the discussions will lead to an agreement being reached between the parties.
The official confirmation of talks comes after Fairfax Media reported a deal between the two groups had begun before Christmas, when KKR approached the struggling manufacturer.
In August Pacific Brands announced it would buy back up to 10 per cent of its stock, on the same day it reported a loss weighed down by non-cash impairment charges and restructuring costs.
Pacific Brands reported a loss of $132 million for fiscal 2011.
