Strip Club Wedding: RICK Buys VCGH

Strip club owner Rick's Cabaret (RICK) of Houston, Texas, this afternoon said it signed a letter of intent with Denver-based VCGH (VCGH), another strip club owner, to purchase VCGH using RICK stock for a value of $2.20 to $3.80 per share.

That's well above the $2.22 VCGH closed at today.

Rick's management said the combination would form the “largest publicly traded operator of upscale gentlemen's clubs in North America.” The two companies had combined revenue of $131 million in the 12 months ended September, the companies said.

VCGH owns and operates 20 clubs in Colorado, California, Illinois and elsewhere, including the Penthouse Club, La Boheme, and Imperial Showgirls. RICK owns and operates 18 clubs including the “Rick's Cabaret”-branded venues in New York, Las Vegas, Houston and elsewhere.

Rick shares closed up 99 cents, or 8%, during regular trading today after the company missed fiscal Q1 profit estimates but said its earnings guidance was on track for the year.

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