Joined: Dec 2007
Delisting - Maybe not so bad?
I am one of those "unsophisticated" investors. So this is just a thought without the knowledge to argue my point.
However. At this point, with the stock at 39 cents, maybe delisting and trading on the pink sheets would not be so bad. My reasoning is that it would certainly STOP the millions of shares of naked shorting taking place every day.
That guy on the Cincinnati exchange would certainly have to go somewhere else.
I am looking forward to comments. Thanks,
Joined: Jul 2008
Wondering the same thing.
Joined: Oct 2008
Now that the Nasdaq has frozen any delisting processes until at least January of 2009, SIRI will not be going to the pink sheets anytime soon.
You think it is hard to get institutional interest and financing now? You don't want SIRI ever trading on the pink sheets...
Joined: Mar 2008
The new NASDAQ ruling is effective until 1/19/09. If the stock is below $1 for 30-days from 1/19/09 -- that will take it 2/17/09. That is when companies still under $1 will get a deficiency notice. They will then be afforded the standard 180 days from there, which takes it to August 14, 2009 before Sirius will get the notice stating that they will be delisted. That date is obviously WELL after Sirius will have already had to deal with their February convertible maturity and the May bank loans expiring.
It is at that time that Sirius can appeal to NASDAQ asking for more time -- which they will get ANOTHER 180-days if they present a plan to get the price over $1. According to the NASDAQ requirements, that plan MUST include an option to do a reverse split before that final 180-days expires. That final period would expire on February 9, 2010.
So in reality, Sirius has until 2/9/2010 to finish a reverse split to get the price above $1 before any delisting becomes mandatory. This is not an exaggeration, it is a fact. It is also a fact that this is well after all of their 2009 maturing debt will have had to have been dealt with.
It is my opinion that the reason the stock is below $1 is because it is priced for bankruptcy. The adjusted net difference between liabilities and assets leaves about $1.5 billion on the books -- which comes to between $0.40~0.50 per share to shareholders. There is a reason the stock has been bouncing around in this area - and that is because that is its tangible book value, in the event of bankruptcy.
So my opinion is that if Sirius deals with their 2009 maturities in a satisfactory manner - then the price will not remain below $1 -- making the point in this thread moot.
Joined: Mar 2008
One other thing here...
There is another possibility that could come in to play here -- when 1/19/2009 rolls around... if the number of companies still below $1 is at the current levels (or higher), then there is a possibility that NASDAQ will extend the relaxing of this rule for another 90 days.
In their report, NASDAQ noted the number of companies below $1 and how high it has gone in the last year. If the economy is as bad as some claim and things don't turn around, then there is a possibility that the number of companies below $1 could not change, if not get worse. That could force NASDAQ to extend the relaxing of this regulation.
That of course, would extend Sirius' options out even further than I noted above.
Joined: Jul 2008
I agree that SIRI will not get delisted. Thanks Newman for your info on the extra 180 days. You put my worries to rest when you first brought this up.
I guess I just wondered if there would be some benefit to the company to go OTC. (Assuming Mel would lend the money himself) I'm starting to wonder if Mel doesn't mind the price going down. That way he can buy up shares and take them away from people who would short them or sell them at a lower price.
I think it was mentioned that he can't buy until after Q3 results. If I was him I wouldn't mind seeing the price stay low until I could actually release some positive news in much better economic environment. He can then buy at the current discount.
Reassuring investors hasn't helped. He can't change the economy, he can just keep the company above water. So he might as well keep giving realistically low expectations for guidance. He'll at least hold his shares.