Mad Catz to be delisted over "abnormally low" share price
NYSE has already started a process, and Mad Catz does not intend to appeal
Mad Catz Interactive will be delisted from the New York Stock Exchange, due to a consistent trading price that the NYSE has deemed "abnormal."
The threat of delisting has been hanging over the peripherals company since at least January, when the NYSE was alerted by its stock price - $0.15 a share, well below the levels considered appropriate. At that time, Mad Catz said it intended to avoid that fate through a reverse stock split.
In a subsequent shareholder meeting, several of the company's key investors questioned the wisdom of a reverse stock split, arguing that Mad Catz stock was in too much "distress" to benefit. At that point, the stock price had fallen to $0.13.
Since then, Mad Catz shares have never traded above $0.10, and at the end of last week plunged to $0.02. The NYSE informed the company that the "abnormally low trading price" will result in it being delisted, the process of which has already started. Mad Catz common stock can no longer be traded, and Mad Catz has confirmed that it does not intend to appeal the decision.
The question now is whether Mad Catz can survive that transition and continue as a company. It reduced its headcount from 225 people to just 111 in the year leading up to January 2017, and closed Q3 with $11 million in negative working capital. CFO David McKeown said that "negative working capital creates a continued uphill battle for profitability."