THQ Faces NASDAQ Delisting
THQ has been given 180 days to get its share price to at least $1 or facing delisting from the NASDAQ stock exchange.
It's a clammy tale. One day you're on top of the world, making truckloads of money cranking out licensed videogames based on lucrative Disney franchises, and the next you've got people banging on your door and threatening to kick you off the NASDAQ. That's the situation at THQ, which was warned today that it has 180 days to get its share price to a minimum of $1 and then keep it there for ten consecutive days.
It doesn't sound like an overly lofty goal but the publisher has a long way to go to get there. At last check it was trading at just a hair over 67 cents, down from over $36 back in mid-2007. It actually came into the final quarter of 2011 at around the $2 mark, but then crashed to its current state in early December. The company recently announced that it would get out of the licensed game business in order to focus on its core franchises, but those plans could be hampered by a potentially devastating mid-year cash shortage.
There are still options for THQ if it fails to meet the NASDAQ's demands within the allotted time. It could combine its shares in a reverse stock split to make them more valuable, a process Gamasutra [http://www.gamasutra.com/view/news/39670/] described as "expensive, time consuming and embarrassing," or it could try to convince the NASDAQ that it has an effective turn-around plan in place but needs more time to execute it. Whatever happens, it seems like rock-bottom is still waiting to be hit - but it's coming up pretty quick.
Source: Gamasutra [http://www.gamasutra.com/view/news/39926/THQ_may_be_delisted_from_Nasdaq_in_July.php]
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THQ has been given 180 days to get its share price to at least $1 or facing delisting from the NASDAQ stock exchange.
It's a clammy tale. One day you're on top of the world, making truckloads of money cranking out licensed videogames based on lucrative Disney franchises, and the next you've got people banging on your door and threatening to kick you off the NASDAQ. That's the situation at THQ, which was warned today that it has 180 days to get its share price to a minimum of $1 and then keep it there for ten consecutive days.
It doesn't sound like an overly lofty goal but the publisher has a long way to go to get there. At last check it was trading at just a hair over 67 cents, down from over $36 back in mid-2007. It actually came into the final quarter of 2011 at around the $2 mark, but then crashed to its current state in early December. The company recently announced that it would get out of the licensed game business in order to focus on its core franchises, but those plans could be hampered by a potentially devastating mid-year cash shortage.
There are still options for THQ if it fails to meet the NASDAQ's demands within the allotted time. It could combine its shares in a reverse stock split to make them more valuable, a process Gamasutra [http://www.gamasutra.com/view/news/39670/] described as "expensive, time consuming and embarrassing," or it could try to convince the NASDAQ that it has an effective turn-around plan in place but needs more time to execute it. Whatever happens, it seems like rock-bottom is still waiting to be hit - but it's coming up pretty quick.
Source: Gamasutra [http://www.gamasutra.com/view/news/39926/THQ_may_be_delisted_from_Nasdaq_in_July.php]
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