Firearms enthusiasts might call it “two great tastes that taste great together.” Ammunition manufacturer Ammo (NASDAQ: POWW) intends to acquire GunBroker.com — and Ammo stock is exploding on the news.
At 11:50 a.m. EST on Thursday, shares of Ammo stock are up an astounding 20.9% in response to the company’s announcement that it may buy leading online firearms marketplace GunBroker.com. As Ammo advised, it has signed a “non-binding letter of intent” to acquire GunBroker.com from its parent company, IA Tech LLC.
Finalizing the purchase will be contingent upon what Ammo finds after conducting due diligence on its proposed prize, as well as negotiating a “definitive agreement” for the purchase, getting regulatory approval and… raising enough cash to buy the company. (After all, at last report Ammo only had about $3 million in the bank.)