Can these two stocks make it big post the recent stock price crash?
Response to media reports: Vita Group Ltd (ASX: VTG) suffered a set-back with its share price slipping by 21.2% on April 04, 2017. This has come as a blow to the company as there have been media reports doing the rounds about leak of information that relates to Telstra’s possible move to take back high performing stores from licensees, some of which are owned by VTG. Vita has responded to the articles publishing such news and has stated that the company is aware of an article published in the media titled, “Leak reveals Telstra’s considering taking back high performing stores from licensees”, which refers to the contents of a ‘leaked’ Telstra internal ‘draft’ document. As per the article, Telstra (ASX: TLS) has identified a number of stores that it could take back control of by not going ahead with the renew of the Telstra Dealership Agreement (TDA) with licensees. On the other hand, a Telstra spokesperson is said to comment that the leaked information does not reflect the viability of any of the stores listed, and no decisions can be taken on individual Vita sites due to the nature of the agreement. Further, VTG understands that TLS does not have any plans to amend the arrangement with the Vita Group while all conversations with Vita and individual licensees are confidential.The two have known to share a strategic relationship for 22 years under a Master License Agreement and the same has been extended a number of times, and currently extends to 2020. Thus, any significant changes to the above are subject to mutual agreement.
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