Valassis Stock Threatened With De-listing by NYSE
The New York Stock Exchange has threatened to de-list Valassis stock if it does not present a business plan that convinces the exchange that the company can meet certain minimum standards in 18 months. The company said in a statement:
Upon receipt of our business plan, the NYSE has 45 days to review and determine whether we have made a reasonable demonstration of our ability to come into conformity with the relevant standard within the 18-month period. The NYSE will either accept the business plan, at which time we will be subject to ongoing monitoring for compliance with the business plan, or the NYSE will not accept the business plan and we will be subject to suspension and delisting procedures.
Valassis blamed its condition on a $245 million asset write down in its Q4 earnings report. Valassis has also struggled because of the hefty legal bills it is paying for its lawsuit against News America Marketing Group. Valassis believes News America is controlling the in-store market through illegal and exclusionary contracts. That action is parsed between three suits against News America, one in federal court and two in state courts.
The company said it can turn itself around:
We intend to submit such a plan, which may include among other things, elements from our previously released 2009 Profit Maximization Plan (designed to reduce costs, increase production efficiencies and place focus on our greatest growth and profit opportunities) and a positive impact from both a potential asset sale as well as any repurchase of our outstanding term loans through one or more “modified Dutch” auctions during 2009.
The company’s stock was trading at just $1.46 cents at the time of writing, down from $40.36 in 2005.
- See BNET’s previous coverage of Valassis:
- Valassis’ Plan to End Newspaper Coupons Outrages Middle America
- Valassis Suit vs. News America Being Conducted in Secrecy
- Valassis: Layoffs Will Continue as It Reduces Newspaper Coupon Business; It’s All News America’s Fault
- Valassis Writes Down $245 Million in Assets; Legal Bills Running at 10% of Profits
- Valassis Angers Blogger Moms by Yanking RedPlum Coupons From Newspapers
- Valassis Reduces the Cost of Fun for Employees
- Direct Mail Giant Valassis Is “Not Paying Its Bills”; Stock Is “Worth $0”
- Alloy Beats WPP, IPG et al in Network Efficiency Ranking
- The Cost of Valassis’ Suit vs. News America Is Eating Its Profit
Jim Edwards, a former managing editor of Adweek, has covered drug marketing at Brandweek for four years, and is a former Knight-Bagehot fellow at Columbia University's business and journalism schools. Follow him on Twitter or send him an email.
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