When it rains, it pours. The day after a Wall Street Journal piece mentioned a potential bankruptcy filing, Nortel announced it received a delisting warning from the New York Stock Exchange.
Nortel's stock has closed under a dollar per share during the last 30 consecutive trading days ending December 9. Under NYSE rules, the company has six months from the date of notice (December 11) to bring up its average common share price back above a dollar. If the share price doesn't improve, Nortel says it will consider a "consolidation" - i.e. a reverse split - during its annual 2009 meeting in the spring.
Assuming, that is, Nortel is still an independent entity at that time. If Nortel files for bankruptcy and cleans the debt off of its books, it would become much more attractive for a buyer to purchase parts or the whole of the company.
- Nortel talks about its delisting notice. Release.
WSJ: Nortel eyeing possible bankruptcy
Nortel posted a $3.4 billion loss last month