McClatchy: What happens to a delisting deferred?
The owner of the Miami Herald and Sacramento Bee said in a press release on Tuesday that it once again meets the New York Stock Exchange’s listing standards.
In other words, it gets to keep playing on the big board.
McClatchy was in danger of having its stock delisted because it failed to meet the minimum requirements that the NYSE has for a company’s stock price.
But now there’s good news, the company said:
The NYSE received approval from the Securities and Exchange Commission to amend the NYSE’s continued listing standard… The average market capitalization requirement has been lowered from no less than $75 million over a 30-trading-day period to no less than $50 million over a 30-trading-day period and the stockholders’ equity requirement has been lowered from no less than $75 million to no less than $50 million. As a result of these changes, McClatchy is now considered in compliance…
The company is also getting a temporary pass from the requirement that it trade over $1 a share. Normally, if a stock’s price falls below $1 over a 30-trading-day period, it gets a finger-wagging from the NYSE. That rule, fortunately, has been suspended for now. As a result, McClatchy has until December 7 to get its share price back up. (It’s at 81 cents now after briefly going over $1 last week.)
Of course, there are more death-defying episodes ahead. The company has to get enough of its creditors to agree to convert their debt into new kinds of debt that it is offering at terms that aren’t quite as hot as before. If the creditors don’t agree, they go to the back of the line of people who get their money returned if McClatchy declares bankruptcy. Then there is the other matter of trying to find a way to survive the danger of diminishing ad revenue while trying to produce quality journalism.
But it learned one valuable lesson on Tuesday: When you are stuck on the cliffhanger, it helps to move the cliff.