Exclusive: Stonewall Hotel’s former co-owners were bought out by the venue’s new American owner using shares valued at $US6 million ($A9.2 million) when the deal to acquire the Sydney gay bar was struck – stock that has since more than doubled in value.
The acquisition by Pride Holdings Group, disclosed for the first time in its latest financial filings, was completed entirely through a transfer of equity, with the US company issuing 100 million of its own shares, priced at 6 US cents each, to Stonewall's co-owners. No cash changed hands as part of the deal.
Shares in Pride Holdings last traded at 14 US cents as of 4pm AEDT on Friday, which is about 133 per cent higher than the price used in the transaction, effectively more than doubling the on-paper value of the deal to about $US14 million (roughly $A21.5 million).
The disclosure of the deal's financial terms comes as Pride Holdings Group reported significant financial pressure in its latest results. Listed on the lightly regulated OTC Markets, the company posted a net loss of $US530,906 ($A813,000) for the quarter ending September 30 and a $US1,097,889 ($A1.68 million) loss for the nine months to that date, both larger than the comparable periods in 2024.
It now has an accumulated deficit of $US16,061,176 ($A24.6 million) and ended September with just $US111,329 ($A170,600) in cash, down from $US367,094 ($562,000) at the end of 2024.
Despite its weak cash position and a "going concern" warning – signalling doubt about its ability to continue operating for the next year – Pride Holdings has been rapidly expanding its portfolio of LGBTQ+ focused hospitality and entertainment venues, largely by issuing new stock rather than using cash.
These acquisitions have dramatically increased the number of shares on issue. Issuing large volumes of stock reduces the ownership percentage of existing shareholders – similar to how printing more money reduces the value of each dollar – unless the company grows quickly enough to offset the dilution. The company now has 1,515,811,870 shares on issue.
The Stonewall purchase in Sydney was formally approved on August 3, according to financial filings, even though an uncirculated media release – discovered by Gay Sydney News while researching an unrelated story – had appeared on Pride Holdings' website weeks earlier, on July 9, announcing the deal.
Share allocations connected to the acquisition were issued on September 5.
Fohson Investments Pty Ltd ATF [as trustee for] John Foo Trust received 46,200,000 common shares at $US0.06, valued at $US2,772,000 ($A4.25 million). Fohson's shareholders include Eunice, Richard and Elizabeth Foo. At a trading price of 14 US cents, Fohson's holding is now worth $US6,468,000 (about $A9.91 million).
Fetch Financial Pty Ltd received 23,000,000 shares valued at $US1,380,000 ($A2.12 million). Its sole shareholder, Stacey Magree, became a listed owner of Stonewall after its share register was updated on September 2, just days before the sale, transferring Graham Magree's shares to Fetch Financial Pty Ltd. At 14 US cents, Stacey Magree's stake through Fetch is now worth $US3,220,000 (about $A4.94 million).
Craig Geoffrey Bell and Wendy Anne Bell, as trustees for their superannuation fund, received 30,800,000 shares valued at $US1,848,000 ($A2.83 million). At 14 US cents, their holding is valued at $US4,312,000 (about $A6.60 million).
As previously reported by Gay Sydney News, Stonewall's former co-owner Craig Bell — a former NSW Police criminal investigator constable — has since been appointed to Pride Holdings' board.
Meanwhile, former co-owner Richard Foo was appointed director of Asia Pacific.
Delayed financial results amid a year of share-based acquisitions
Pride Holdings' financial results were published several days late, lodged on November 19 US time. The company sought an extension on November 12, saying it was still "in the process of gathering the information" from its acquisitions needed to complete its consolidated statements.
The Stonewall deal sits within a wider wave of acquisitions made by Pride Holdings throughout 2025, almost all of them funded entirely in shares.
On September 19, Pride Holdings approved the purchase of Stonewall Bali in Indonesia for 4,285,714 shares at $US0.06, valuing the deal at $US257,142 ($A394,000).
On August 25, the company approved the purchase of the Castle of Camino in Italy, which it valued at $US18.5 million ($A28.4 million). The castle was acquired from chief operating officer and board director Timothy Majors, who originally hails from Australia, in exchange for a yet-to-be-determined number of shares.
According to the company, Majors holds law and business degrees from the University of Sydney, began as a corporate lawyer, led a national consolidation of Australia’s educational bookselling industry, and achieved a successful exit to a Macquarie Bank-backed private equity firm.
Majors did not respond to a question from Gay Sydney News asking why a press release announcing the Stonewall purchase was published on the company’s website on July 9 despite the board approving the deal on August 3.
Meanwhile, on August 1, the company approved the purchase of the Johnsons gay bars in Tampa and Fort Lauderdale for 100,000,000 shares at $US0.06 each, valuing the acquisition at $US6 million ($A9.2 million). That deal also appeared in a company media release on July 9. The venues' former owner, Matt Colunga, who joined Pride Holdings as part of the transaction, plans to convert the top floor of Stonewall Sydney into an upmarket, all-male nude strip club based on the Johnsons format.
On August 3, Pride Holdings approved the acquisition of two Aquaplex venues – nightclub and entertainment complexes in Florida's Key West and Fort Lauderdale – for 254,000,000 shares at $US0.06 each, valuing the businesses at $US15.24 million ($A23.4 million).
On August 14, it approved the purchase of Lucky’s Gay Bar in West Palm Beach, Florida, for 10,000,000 shares at $US0.06, valuing it at $US600,000 ($A919,000).
And on August 15, the company approved the acquisition of Fountain Coles & Company – which operates Club One, a multi-level LGBTQ-friendly nightclub in Savannah, Georgia – for 22,428,572 shares at $US0.06 each, valuing the deal at about $US1.35 million ($A2.07 million).
The company's only cash acquisition was drag show palace and restaurant Lips Motor Row in Chicago, Illinois, purchased for $US840,000 ($A1.29 million) and approved on September 15.
Ben Grubb is the founder and editor of Gay Sydney News, an independent publication covering LGBTQIA+ news. A journalist with more than 15 years' experience, he has reported and edited for The Sydney Morning Herald, The Age, WAToday, Brisbane Times, The Australian Financial Review, News.com.au, ZDNet, TelecomTimes and iTnews, primarily on the topic of technology. He previously hosted The Informer, a queer current affairs program on Melbourne’s JOY 94.9 radio station, and contributes to LGBTQIA+ media including Stun Magazine. Ben has also appeared as a technology commentator on Channel Ten's The Project, ABC RN’s Download This Show and commercial radio stations 2UE, 2GB and 6PR. Contact Ben: [email protected]
