Tuesday, September 7, 2010

The Style Merchants (TSM)

The Style Merchants (TSM): last traded at $0.055, +10% in morning session. Proposed to acquire Celebrity Next Ltd (CNL) for RMB3.2m, to be paid for by 13.7m new shares (1.6% dilution) at issue price of $0.046 …

CNL is a franchisee of TSM’s Fashion Retail business, and has 2 existing self-operated stores in Shanghai and 1 franchise store in East China. While acquisition is small, this could a precursor to more such acquisitions, as TSM rolls out its growth strategy to set up more than 10 self-operated retail shops in major cities, with at least 4 in Shanghai.

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