Furniture Brands shareholders OK reverse stock split options
May 7, 2013-- Furniture Today,
ST. LOUIS — Shareholders of Furniture Brands International have approved a pair of options for a reverse stock split that would help keep the company's stock price above $1 and preserve its New York Stock Exchange listing.
The approvals give the board of directors the authority to implement a 1-for-5 or 1-for-7 reverse split anytime prior to the company's next annual meeting in May 2014.
A reverse split reduces the number of outstanding shares and therefore increases the price per share. For example, a 1-for-5 split means a stockholder with 100 shares priced at $1 per share would own 20 shares priced at $5 per share after the split.
New York Stock Exchange rules require a company's stock price to be at least $1per share over 30 consecutive trading days. Furniture Brands stock has traded in the $1 range for several months, and closed Monday at 99 cents per share.
In addition to preserving its NYSE listing, Furniture Brands said a higher share price could also make its stock more attractive to institutional investors and reduce stock price volatility.
Related Content By Author
Hollywood ‘A’ Listers buy into mattress biz, and guess who’s the fastest growing retailer?