In the hopes of avoiding being delisted from the NASDAQ stock exchange, THQ announced plans to offer a reverse stock split. The company needs to do this in order to maintain $1 per share, a key requirement of the exchange.
The company filed with the Securities and Exchange Commission that it plans to propose this reverse stock split at a June 29th stockholders meeting. If shareholders agree to it, the company would choose one of three options: a one for three, one for five, or one for ten stock splits. Exercising these choices will ultimately result in fewer outstanding shares, with an increased value per share.
The company that makes a number of popular titles including the Saint's Row series, UFC games and World Wrestling Entertainment titles received a delisting warning form NASDAQ in January of this year.
The stock is currently trading under $1. In order to avoid being delisted, the company needs to have ten consecutive business days above $1 by July 23.
Earlier this month, THQ reported a net loss of nearly $240 million for its past fiscal year, but that loss was a lot smaller than most analysts had expected...