Assembly Biosciences Announces Effective Date of Reverse Stock Split
Assembly Biosciences, Inc. (ASMB) announced a 1-for-12 reverse stock split of its outstanding shares, reducing the number of shares from approximately 65.8 million to approximately 5.5 million. The split will not affect the number of authorized shares or the par value of the common stock. The split is expected to bring the company into compliance with the minimum bid price requirement for maintaining its listing on The Nasdaq Global Select Market.
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The reverse stock split will result in a significant reduction in the number of outstanding shares, which could potentially lead to a decrease in the stock's liquidity and trading volume, impacting shareholder value.
The execution of a 1-for-12 reverse stock split by Assembly Biosciences is a strategic financial maneuver aimed at addressing the minimum bid price requirement for its continued listing on The Nasdaq Global Select Market. This action typically indicates that a company's share price has been trading below the exchange's minimum threshold, which can often be a concern for investors regarding the company's market perception and financial health.
From a financial perspective, while the reverse stock split does not inherently alter the company's market capitalization, it does have implications for liquidity. The reduction in the number of shares outstanding can lead to decreased share liquidity, which might result in higher volatility in the stock price. However, it can also potentially attract institutional investors who may have policies against investing in stocks below a certain price. It's important to monitor the stock's performance post-split to assess the market's reaction and the effectiveness of this strategy in stabilizing the stock's value.
Reverse stock splits are often perceived negatively by the market as they can be interpreted as a remedial action for a stock that is underperforming. However, they can also be viewed as a company taking proactive steps to comply with stock exchange regulations and improve its standing with investors. For Assembly Biosciences, the reduction in shares from approximately 65.8 million to 5.5 million will result in a higher price per share, which could improve the perception of the company among investors who equate share price with company quality.
It is essential to analyze the broader biotechnology sector's performance to understand how this move fits within industry trends. If the sector is experiencing similar challenges, the reverse stock split might be less of a concern. However, if Assembly Biosciences is an outlier, this could signal deeper issues within the company that may warrant further investigation.
The reverse stock split reflects a legal corporate action that requires shareholder approval, which Assembly Biosciences secured during its special meeting. This process is governed by securities law and exchange regulations, ensuring that the interests of shareholders are considered. The fact that the company is taking steps to maintain compliance with Nasdaq's listing requirements is a positive sign of its commitment to corporate governance.
Post-split, the company must continue to meet other listing standards, such as corporate governance and reporting requirements. Failure to comply with these standards could result in further regulatory scrutiny or even delisting, which would have significant implications for the company's ability to raise capital and for shareholder value.
02/08/2024 - 08:00 AM
– Assembly Bio common stock expected to begin trading on a split-adjusted basis on February 12, 2024 –
SOUTH SAN FRANCISCO, Calif., Feb. 08, 2024 (GLOBE NEWSWIRE) -- Assembly Biosciences, Inc. (Nasdaq: ASMB), a biotechnology company developing innovative antiviral therapeutics targeting serious viral diseases, today announced that it expects a 1-for-12 reverse stock split of its outstanding shares of common stock will be effective as of February 9, 2024. The company anticipates that its common stock will begin trading on a split-adjusted basis on The Nasdaq Global Select Market under the same symbol (ASMB) when the market opens on February 12, 2024, with the new CUSIP number 045396207.
As of the effective time of the reverse stock split, every 12 issued and outstanding shares of the company’s common stock will be automatically reclassified into one issued and outstanding share of the company’s common stock. This will reduce the number of shares outstanding from approximately 65.8 million shares to approximately 5.5 million, subject to adjustment for fractional shares. The reverse stock split will not affect the number of authorized shares of common stock or the par value of the common stock.
Equiniti Trust Company, LLC, is acting as the exchange agent for the reverse stock split. Registered stockholders holding pre-split shares of the company's common stock are not required to take any action to receive post-split shares. Stockholders owning shares via a broker, bank, trust or other nominee will have their positions automatically adjusted to reflect the reverse stock split, subject to such broker's particular processes, and will not be required to take any action in connection with the reverse stock split. Stockholders holding shares of the company's common stock in certificate form will receive a transmittal letter from Equiniti with instructions as soon as practicable after the effective date.
The reverse stock split is primarily intended to bring the company into compliance with the minimum bid price requirement for maintaining its listing on The Nasdaq Global Select Market. The reverse stock split was approved by the company’s stockholders at its special meeting of stockholders held on January 31, 2024. After this meeting, Assembly Bio’s board of directors approved the reverse stock split at a ratio of 1-for-12. Additional information about the reverse stock split can be found in the company’s definitive proxy statement filed with the Securities and Exchange Commission on December 21, 2023, which is available free of charge at the SEC’s website, www.sec.gov, and on the company’s website at www.assemblybio.com
About Assembly Biosciences assemblybio.com
Forward-Looking Statements
Contacts Investor and Corporate: investor_relations@assemblybio.com
Media: ASMBMedia@sambrown.com
Assembly Bio's common stock is expected to begin trading on a split-adjusted basis on February 12, 2024.
The new CUSIP number for Assembly Bio's common stock is 045396207.
The reverse stock split was approved at a ratio of 1-for-12 by Assembly Bio's board of directors.
The reverse stock split will reduce the number of outstanding shares from approximately 65.8 million to approximately 5.5 million.
The reverse stock split is primarily intended to bring the company into compliance with the minimum bid price requirement for maintaining its listing on The Nasdaq Global Select Market.
