Hexo Corp (TSX: HEXO) (NYSE: HEXO) this morning finally announced the inevitable – the company has proposed a share consolidation. The consolidation is required for the company as a means of regaining listing compliance for the NYSE, otherwise the company risks being delisted from the US big board.
Under the proposed consolidation, Hexo will look to conduct the reverse split on an eight for one basis, with currently shareholders receiving one post-consolidation share for every eight pre-consolidation shares. The result of the consolidation is that the company expects its current 483,445,248 common shares issued and outstanding to be reduced to 60,430,656 common shares.
No fractional shares are to be issued in connection with the consolidation. Shares to be issued in connection with outstanding convertible securities, such as warrants, options, and convertible debentures, will be done so on a pro-rated basis following the consolidation.
The consolidation, which is being conducted to meet the NYSE’s minimum pricing standard of $1.00 per share, is to be voted on by shareholders at the December 11, 2020 shareholders meeting. The consolidation is then said to be implemented shortly after this approval is granted.
The announcement follows the release of fourth quarter financials late last night, with the company reporting net revenues of $27.1 million along with a net loss of $169.5 million.
Hexo Corp last traded at $0.72 on the NYSE.
Information for this briefing was found via Sedar and Hexo Corp. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
