Adultshop (ASX:ASC) proposes brothel acquisition
- 10 August, 2010 18:11
Shares in online storefront AdultShop.com (ASX:ASC) have surged 30% after the company announced a proposed a merger with bordello operator Blackfeather Limited.
Under the terms of the proposed merger, AdultShop's share capital would be consolidated on a 1:8 basis. AdultShop would then acquire 100% of Blackfeather's Sydney brothel, Stiletto, for $20 million, then issue $10 million in new shares to sophisticated investment.
After the consolidation, AdultShop would launch a buyback offer for all shares issued, excluding those issued to Blackfeather and under the $10 million placement, at $0.21 per share.
The agreement is subject to conditions including shareholder and regulatory approvals.
ASC shares are currently trading at $0.017.