Naked Brand Rips Higher After Closing Merger With Kiwi Lingerie Company

Naked Brand Group Inc NAKD shares are skyrocketing on more than eight times their average volume after the company announced the completion of a merger agreement with a New Zealand-based marketer of intimate apparels and swimwear.

What Happened

Naked Brands said it has completed its previously announced merger with Bendon following approval by its shareholders on June 11.

The merger agreement, initially announced in May 2017, was subsequently amended four times.

Naked Brand shares slumped 16 percent when the merger was first announced on May 25, 2017 and lost an incremental 13 percent in the next session.

Under the agreement, both companies become wholly owned subsidiaries of a new company, Bendon Group Holding, which has since been renamed as the Naked Brand Group.

Each Naked Brand share was exchanged for 0.2 share in the new company.

Why It's Important

The merger is expected to strengthen the global industry leadership of the combined company and drive growth in the long run. 

For Bendon, the deal provides access to the U.S. capital market, which in turn is likely to provide it the financial flexibility to expand its distribution network, further develop its business and acquire complementary brands.

"We are excited to further revolutionize the lingerie industry through our unwavering commitment to best-in-category innovation in design and technology within product and brand development," CEO Justin Davis-Rice said in a statement. 

What's Next

The shares of the combined company trade on the Nasdaq under the ticker "NAKD."

Naked Brand Group shares were rallying nearly 64 percent to $10.20 at the time of publication Wednesday.

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