Shares in women’s fashionwear retailer, City Chic jumped more than 5% yesterday despite the company pouring cold water on speculation it may be gearing up for another international acquisition.
After media reports that it was doing just that, City Chic told the ASX it had no news to announce at the current time.
Not that it had no news full stop, just at this time. As a result, the shares rose 5.5% as investors speculated that the company did not rule out a deal in the near future.
The announcement was in response to a report suggesting City Chic was gearing up for its second acquisition in the last 12 months, with its sights on another US-based retailer.
The report said the retailer could be looking at capital raising to finance the takeover.
In response, City Chic said there had been no agreement on the terms of any potential acquisitions, and any opportunities were “not sufficiently advanced to warrant any further disclosure”.
“City Chic will keep shareholders informed in accordance with its continuous disclosure obligations,” the company said.
Last year, City Chic bought the digital assets US plus-sized clothing chain Avenue for around $25 million, a purchase which has helped the company’s online sales, which now amount to two-thirds of the business’ revenue.