The Reverse Splits: Blockbuster Has 45 Days to Get Back in NYSE's Good Graces

A couple of weeks back, we read the entirety of Blockbuster's annual report and discovered one significant bit of bad news that had gone unnoticed elsewhere: The New York Stock Exchange sent the downtown Dallas-based company a warning that if it didn't get its stock price back above one dollar...

By Robert Wilonsky

March 29, 2010

[
        {
          "name": "Air - MediumRectangle - Inline Content - Mobile Display Size",
          "component": "18855504",
          "insertPoint": "2",
          "requiredCountToDisplay": "2"
        },{
          "name": "Editor Picks",
          "component": "17105533",
          "insertPoint": "4",
          "requiredCountToDisplay": "1"
        },{
          "name": "Inline Links",
          "component": "18349797",
          "insertPoint": "8th",
          "startingPoint": 8,
          "requiredCountToDisplay": "7",
          "maxInsertions": 25
        },{
          "name": "Air - MediumRectangle - Combo - Inline Content",
          "component": "17105532",
          "insertPoint": "8th",
          "startingPoint": 8,
          "requiredCountToDisplay": "7",
          "maxInsertions": 25
        },{
          "name": "Inline Links",
          "component": "18349797",
          "insertPoint": "8th",
          "startingPoint": 12,
          "requiredCountToDisplay": "11",
          "maxInsertions": 25
        },{
          "name": "Air - Leaderboard Tower - Combo - Inline Content",
          "component": "17105535",
          "insertPoint": "8th",
          "startingPoint": 12,
          "requiredCountToDisplay": "11",
          "maxInsertions": 25
        }
      ]

A couple of weeks back, we read the entirety of Blockbuster's annual report and discovered one significant bit of bad news that had gone unnoticed elsewhere: The New York Stock Exchange sent the downtown Dallas-based company a warning that if it didn't get its stock price back above one dollar pronto, Blockbuster's in danger of being delisted. In a press release today, the company also warned: "It has been notified by the New York Stock Exchange that its average global market capitalization had fallen below $75 million over a 30 trading-day period." The clock's running on a 45-day period to submit a plan to get back in compliance or else.

So, CEO Jim Keyes, what's the plan? "We intend to promptly submit a plan to the NYSE, which will outline the proactive steps we plan to take to remedy the Company's non-compliance by September of 2011." In other words, you'll have to wait till April 16 to find out, so there. One other bit of bad news: Celebrated MLB.com CEO Bob Bowman announced today he's dropping off the Blockbuster board.

Meanwhile, shares have dropped 10 percent today ... to a whole 28 cents. That said, the same release -- issued in advance of the May 26 shareholders meeting at Renaissance Tower -- does propose one way to bump the price of shares: reverse stock split, a move I mastered during my days as a cheerleader. Shareholders will be asked to approve the move. Hmmm, let me and my newly acquired 100 shares think about that one for a while.

KEEP THE OBSERVER FREE... Since we started the Dallas Observer, it has been defined as the free, independent voice of Dallas, and we'd like to keep it that way. Your membership allows us to continue offering readers access to our incisive coverage of local news, food, and culture with no paywalls. You can support us by joining as a member for as little as $1.