13/10/2009 - 11:02

Adultshop unlikely to accept takeover

13/10/2009 - 11:02

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Adultshop.com has indicated it is unlikely to recommend a hostile takeover offer from Melbourne group Sexyland, saying its directors will not accept the offer on its current terms.

Adultshop unlikely to accept takeover

Adultshop.com has indicated it is unlikely to recommend a hostile takeover offer from Melbourne group Sexyland, saying its directors will not accept the offer on its current terms.

 

The announcement is below:

 

AdultShop.com Limited (AdultShop) is pleased to provide an update to shareholders on the Company's response to the announcement by Sexyland Australia Pty Ltd (Sexyland) of its intention to make an unsolicited takeover offer (the Offer) to acquire all of the shares and options in AdultShop.

AdultShop has appointed the appropriate advisors to assist the Company with its formal response to the Offer.

Sexyland has indicated that it will lodge a Bidder's Statement on 31 October 2009 and dispatch the Bidder's Statement to AdultShop shareholders 2-3 weeks later. AdultShop will issue a Target's Statement in response, setting out the Board's formal recommendation to shareholders.

However, the Board notes that Sexyland's takeover offer is at a substantial discount to the net tangible asset backing of AdultShop after completion of the current fully underwritten non-renounceable entitlement issue.

The Sexyland offer values AdultShop shares at 0.84 cents per share, which is a 65% discount to the net tangible asset backing per AdultShop share of 2.4 cents per share after completion of the entitlement issue (based upon 30th June 2009 audited accounts).

Each of the AdultShop Directors who currently hold, or who will hold shares in the Company after completion of the entitlements issue, have indicated that they will not be accepting Sexyland's takeover offer on the terms set out in Sexyland's takeover offer announcement dated 8th October 2009.

As detailed in the prospectus for AdultShop's entitlement issue dated 16 September 2009, part of the funds raised under the entitlements issue will be used for the review and acquisition of new opportunities. The Board continues to explore a range of options to unlock value for AdultShop shareholders.

Shareholders and optionholders are advised to TAKE NO ACTION in relation to the Sexyland announcement at this stage.

STANDING BY BUSINESS. TRUSTED BY BUSINESS.

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