On Friday, McClatchy revealed that it received a notice from the NYSE American LLC. Because of its deficits and debts, it could be removed from listing.
According to the company, it
has until March 2021, or approximately 18 months, to become compliant or risk being removed from the NYSE.
McClatchy is below compliance with two of the NYSE American continued listing
standards, stemming from a reported stockholders’ deficit of $372.5 million (as of June 30, 2019) and net losses during the four most recent fiscal years.
Currently, the company’s
market value falls below the NYSE American minimum of $15 million.
The Sacramento Bee, one of the company’s 30 newspapers, notes the exchange’s rules don’t include the
market value of Class B shares. In this case, those are controlled mostly by members of the McClatchy family. The rules also don’t take into account shares held by two institutions, each owning
10% of the company.
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McClatchy’s market value would be more than $23 million if these shares were taken into account.
McClatchy said that neither the notification nor
delisting would affect its business operations. Its stock is being traded with an attached designation of “.BC” to indicate its noncompliance.
The company will submit a plan to
NYSE American by October 9 that outlines how it will regain compliance by the deadline.
NYSE American can delist the company if it doesn’t approve of the plan, if the company
doesn’t make progress in line with the plan, or is not in compliance by the deadline.