Verso Corp. was delisted from the New York Stock Exchange because of a precipitous decline in the value of its stock.
The NYSE notified the company in June that its stock was not meeting the exchange’s standard requiring the average share price of Verso’s common stock be at least $1.00 over a consecutive 30-trading-day period. At the time of the June 24 notification, the average closing price of Verso’s common stock over the past 30 trading days was 96 cents per share. The stock exchange asked the company to submit a plan to bring its stock back into compliance.
Verso submitted that plan Monday morning, but the stock continued to fall throughout the day. By Monday afternoon it was being traded at 15 cents a share before the NYSE suspended trading.
“The NYSE, in interpreting its continued listing standards, has determined that a trading price of $0.15 or less per share is ‘abnormally low’ and, therefore, is cause for suspension of trading and delisting from the NYSE,” Verso announced in a news release.
The NYSE also told Verso it would not consider the compliance plan the company had submitted Monday morning, nor would it be given another chance to achieve future compliance.
The share price of Verso’s stock was not the only metric that concerned the NYSE. On Aug. 13, the stock exchange sent the company a second notice that it had run afoul of another listing standard requiring the paper company’s average market capitalization to be at least $50 million over a period of 30 consecutive trading days. On the date of the notification, the company’s average market capitalization over the past 30 trading days was approximately $44.2 million.
After the NYSE’s action, Verso’s common stock began trading in over-the-counter markets. The company said its suspension and delisting from the NYSE are unrelated to Verso’s business operations and do not constitute a default under any of Verso’s credit agreements and debt securities.
On Wednesday, Verso’s stock opened at 6 cents a share on the OTCQX market. It lost another 50 percent of its value throughout the day, closing at 3 cents a share.
Verso once operated two paper mills in Maine, but it closed its Bucksport mill late last year and sold it to a scrap metal recylcer. It still operates a paper mill in Jay, but in August laid off 300 workers. It continues to employ roughly 530 people at the Jay mill.
In January, Verso acquired NewPage Holdings in a $1.4 billion deal. NewPage had owned the Rumford paper mill, but sold that mill to British Columbia-based Catalyst Paper to ensure the federal government approved the merger despite anti-trust concerns that the combined company would control too much of the market for coated paper in North America.
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