The Nick Scali Limited (ASX:NCK) share price is climbing after it confirmed media reports of a potential acquisition, here are the details.
Speculation of Nick Scali acquisition
Nick Scali went into a trading pause earlier today so that it could have time to respond to media reports of a potential acquisition of plush sofas business “Plush”.
In Nick Scali’s media release it confirmed that it is in non-exclusive discussions with Greenlit Brands to potentially acquire Plush.
Nick Scali said that discussions are “ongoing and incomplete” and there is no certainty that current discussions will result in a binding transaction for Plush, or that any agreement will be reached with Greenlit Brands.
Nick Scali expects to be able to fund the transaction with a combination of cash on hand and debt, should any transaction with Greenlit Brands proceed.
Summary thoughts on Nick Scali and the share price
Nick Scali has done well in the changing retail landscape resulting from COVID-19 and is continuing to grow its business. Some of Nick Scali’s growth plans include expanding its store network and growing its digital offering.
Investors have responded positively with the news of potentially acquiring Plush, with the Nick Scali share price up over 4% today, whilst the ASX 200 (ASX: XJO) is down around 1%.
Though, it is wise to remember that Nick Scali stressed that these talks of acquiring Plush have no guarantee to lead to anything and the share price may drop back down if the excitement dies down.