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Koovs signs £24m media deal with HT Media
India-focused online clothes retailer Koovs has agreed a buy large swathes of advertising over two years from the owner of the Hindustan Times, in exchange for shares and cash.
Under the agreement, Koovs will buy four £6m tranches of media from strategic partner HT Media at six-monthly intervals over a twenty-four-month period, £4.2m of which will be satisfied in exchange for new shares, while the remainder covered by cash payments.
The conversion price for the first £4.2m tranche of new shares to be issued to HT Media would be 10p per Koovs share, versus an 11.35p closing price at the end of last week. Thereafter each tranche would be priced at the lower of the firm's three-month average at the time.
Koovs' deal with HT is conditional upon the firm raising at least £6m in cash, something it said it has already received good indications of support via "positive discussions with existing and potential new shareholders".
In March, directors unveiled a strategy to raise around £50m to fund a growth acceleration plan, with the bulk of the funding dedicated to marketing and branding.
Mary Turner, Koovs' chief executive, said: "We are delighted to have agreed this deal with HT Media, one of India's most influential media companies. 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."
"As India's best-established affordable fashion brand, we are resolutely focused on scaling the business to leverage our competitive advantages in what is the world's fastest growing economy," added Turner.
As of 0850 BST, Koovs shares had shot up 21.41% to 13.78p.