Koovs PLC (LON:KOOV) shares jumped on Monday morning as the online fashion retailer signed a conditional two-year £24mln agreement with HT Media Limited, one of India’s largest media companies and owner of the Hindustan Times
Under the agreement, the company will acquire four £6mln tranches of media from HT Media at six-monthly intervals over a 24-month period.
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The company said 70%, or £4.2mln of the first £6mln instalment will be satisfied by the issuance of new ordinary shares in the company to HT Media, with the balancing 30%, or £1.8mln, to be acquired by Koovs in cash.
After the completion of the first instalment, Koovs will receive £16.8m of media and advertising services from HT Media. The online fashion retailer has also agreed to commission further media and advertising services from HT Media for £7.2m in cash to be drawn in four tranches over the 2-year period.
The conversion price for the first £4.2m tranche of new shares to be issued to HT Media is to be 10 pence per Koovs share.
Mary Turner, Chief Executive of Koovs, said: "We are delighted to have agreed this deal with HT Media, one of India's most influential media companies.”
She added: “It will mark the successful completion of the first round of funding for our strategic acceleration plan, providing us with an important platform to support our future growth.”
In morning trading, Koov’s shares jumped 22.9% to 13.95p.