William B. Cassidy, Senior Editor | Oct 28, 2011 10:32AM EDT
Struggling trucking giant YRC Worldwide may stay on the Nasdaq stock exchange despite the low value of its stock, a Nasdaq hearings panel decided this week.
In return, the $4.3 billion less-than-truckload carrier must execute a reverse-stock split by Dec. 31 and keep its per share value above $1 for ten consecutive days. The Oct. 25 decision lifted fears the LTL carrier, which completed a $500 million financial restructuring in July, would be kicked off the Nasdaq exchange.
Nasdaq requires companies to maintain a per share value above $1. The company warned YRC Worldwide it faced delisting if it could not bolster its stock price.
YRC’s restructuring created more than a billion new shares of common stock, sending the value of the company’s stock down to about 6 cents a share. YRC promised to complete a reverse stock split that would bring it back into compliance with Nasdaq rules requiring companies to keep share values above $1.
Shareholders will vote on whether to approve a reverse stock spit at the company’s annual shareholder meeting Nov. 30. The ratio hasn’t been announced.
YRC Worldwide’s stock has been on a downhill slide over the past few years as the company restructured its finances to reduce its debt and avoid bankruptcy. A debt-for-equity swap with bondholders in 2010 led to a massive infusion of new stock and a one-to-25 reverse stock split that sent its share value up to $6.
Contact William B. Cassidy at wcassidy@joc.com. Follow him on Twitter at @wbcassidy_joc
