Delcath Systems (NSDQ:DCTH) said today that it is preparing for a 1-for-350 reverse stock split, which is set to take effect on Nov. 6.
According to the terms of the reverse split, Delcath’s common stock will trade under a new symbol – DCTHD – for twenty days and then revert back to its old symbol, DCTH.
The reverse split will reduce the number of issued and outstanding shares of the company’s common stock from 490 million to 1.4 million shares.
In September, Delcath and a group of investors made an end run around the company’s shareholders with a deal that paved the way for the reverse split that stockowners have twice shot down.
“Together with our Board of Directors, we are taking these actions in the best interests of all shareholders. Regaining access to equity capital will allow us to continue investing in our Clinical Development Program and our commercial efforts in Europe,” president & CEO Jennifer Simpson wrote in a letter to the company’s shareholders.
Delcath proposed a reverse stock split in June and September of this year, but both times stockholders voted against the move. The company said those decisions left it unable to access cash otherwise available under 2016 convertible notes or to go after new equity financing.
Delcath said that it unless it made authorized shares available, it wouldn’t be able to fund its business beyond the next few months.
The company inked a deal with the 2016 convertible note holders, providing the issuance of Series C preferred shares in exchange for $500,ooo in cash. The deal gave the convertible note holders “enhanced voting rights” – sufficient to give a thumbs-up on the reverse stock split.
