NEW YORK (TheStreet) -- Shares of LightInTheBox (LITB) are rallying by 9.34% to $5.62 on heavy trading volume after the company said that shoe and leather products maker Zhejiang Aokang Shoes agreed to acquire a stake in the Chinese online retailer.
"We are pleased to team up with LightInTheBox to jointly-develop a global 'Internet-Plus' strategy for traditional businesses by leveraging their deep understanding of global ecommerce and superior technological expertise," Aokang's Chairman Zhentao Wang said in a statement.
Under the terms, Aokang has agreed to acquire a 25.66% equity interest from investors at $66.40 per share, and plans to invest $77.3 million in the company.
Aokang said it plans to set up a unit in Hong Kong for $2.58 million, according to Reuters.
About 3.2 million shares were traded by 1:25 pm on Wednesday, above the company's trading volume of about 147,000 shares a day.
Separately, TheStreet Ratings team rates LIGHTINTHEBOX HLDG -ADR as a Sell with a ratings score of D. TheStreet Ratings Team has this to say about their recommendation:
"We rate LIGHTINTHEBOX HLDG -ADR (LITB) a SELL. This is driven by some concerns, which we believe should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks we cover. The company's weaknesses can be seen in multiple areas, such as its feeble growth in its earnings per share, deteriorating net income, disappointing return on equity, poor profit margins and weak operating cash flow."