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REFILE-UPDATE 1-TPG walks away from $713 mln Billabong bid

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(Corrects to show US$ value of deal in headline, rather than A$value)

* Billabong shares seen under pressure

* Deutsche Bank gives Billabong fundamental valuation of 85cents a share

SYDNEY, Oct 12 (Reuters) - Private equity firm TPG haswithdrawn its A$694 million ($713 million) takeover bid forAustralian surfwear retailer Billabong International Ltd, a week after raising concerns while inspecting thebooks.

The withdrawal of the bid is likely to put further pressureBillabong's shares as the firm struggles with a weakening retailoutlook in Australia. The shares are due to start trading at0000 GMT on Friday, an hour after the market open.

Billabong stock fell as much as a quarter last week to itslowest in three months after TPG first raised its concerns. Thestock closed on Thursday at A$1.005 a share and has been tradingwell below TPG's offer price of $1.45 since late August,indicating investor nervousness.

"When two bidders have walked away after seeing the books,the first question in investor minds is: what is hiding in thebooks? The TPG withdrawal is a big negative for the stock," StanShamu, market strategist at IG Markets said.

Buyout firm Bain, which came in with a rival bid, withdrewlast month.

Deutsche Bank said in a note to clients last week that TPGquitting the deal would send the stock lower. It gives the stocka valuation of 85 cents a share.

TPG's withdrawal means shareholders will have to rely thecompany's recently outlined four-year plan to simplify thebusiness in the hope of reviving falling sales and restoringprofitability, analysts said.

Billabong has already conceded investors would have to waittwo years to see the biggest benefits of the new strategy.

"Billabong continues to implement its transformationstrategy detailed on Monday, 27 August 2012. This strategy,under CEO Launa Inman, provides a clear pathway to unlocking theinherent value within the company," it said in a statement.

Billabong, which in August reported its first annual losssince listing over a decade ago, snubbed a more generous TPGoffer of A$3.30 a share in February.

It dumped its chief executive in May after several profitdowngrades, and appointed Inman who previously headed discountchain Target, owned by Wesfarmers

Since the first approach from TPG, which has a 12.5 percentstake in the company, Billabong has sold half of its watch brandNixon and raised A$225 million in equity to reduce debt.($1 = 0.9735 Australian dollars)

(Reporting by Narayanan Somasundaram; Editing by Richard Pullinand John Mair)

((narayanan.somasundaram@thomsonreuters.com)(+61 293731815)(Reuters Messaging:narayanan.somasundaram.reuters.com@reuters.net))

Keywords: BILLABONG TPG/