A somewhat red-faced Blockbuster revealed today that it is not in compliance with a New York Stock Exchange rule and has 45 days to submit a plan that will return it to compliance within 18 months. The rule in question requires that companies listed on the exchange have a global market capitalization (market cap) of $75 million over a 30-day trading period.
BB’s shares, which hit a peak of $29 in the company’s heyday in 2002, closed at 28 cents today. Company CEO Jim Keyes, who has gotten very well-versed at spinning bad news lately, said the following about Blockbuster’s plans to return to NYSE compliance:
“We intend to promptly submit a plan to the NYSE, which will outline the proactive steps we plan to take to remedy the company’s noncompliance by September of 2011,”
The company will ask investors to approve the execution of a reverse stock split at its upcoming annual shareholder meeting, which would artificially inflate the value of BB stock by combining Class A and B stock into a single, smaller class.
Any Blockbuster stockholders out there, Insiders? Whether you own BB’s penny stocks or not, tell us what you think about this latest hit to the company’s reputation. Will Blockbuster be around in September of 2011 to make good on Keyes’ “proactive steps”?