Audacy Doing a Reverse Stock Split in NYSE Compliance Effort
Not sure if you saw this last week, but Tim Kelly over at Audacy decided to leave the company after his job was eliminated:
My time at @AudacySports has come to an end. I was informed this week that my writing position was being eliminated. I declined a chance to remain in a behind-the-scenes role. I'm interested in any writing/podcasting opportunities.
— Tim Kelly (@TimKellySports) March 25, 2023
Tim is still doing his gig with Phillies Nation.
Analysts say the Philly-based Audacy, which owns 94 WIP, KYW News Radio, and other local radio stations, needs to cut costs in order to get finances under control. As of Wednesday afternoon, the stock price is currently sitting at 13 cents and the company faces de-listing from the New York Stock Exchange if it can’t get back above a dollar.
In a regulatory filing, Audacy shared it intends to implement a reverse stock split after its shareholder’s meeting on Wednesday, May 24th.
The New York Stock Exchange requires companies to maintain an average closing price of at least $1.00 for 30 consecutive days of trading. Audacy’s price hasn’t closed above that threshold since July 5th of last year.
What’s a reverse stock split anyway? They didn’t teach us about that in high school. We learned useless economic shit like Adam Smith and The Invisible Hand. Nothing practical.
But the reverse stock spit basically consolidates existing shares and turns them into fewer shares that are higher priced. This doesn’t actually add value to the company though, they more or less just merge stock to get back in compliance. For instance, if you had 1,000 shares of Major League Pickleball at $5 each, you might end up owning 100 shares at $50 each after the split. Make sense?
The short version is that Audacy denied bankruptcy rumors last summer, but they’ve still got a lot to clean up and need to cut costs.