Shares of The McClatchy Co. (NYSE, for now: MNI) have been below $1 since Jan. 14, which in normal times would have been enough to boot them off the Big Board, and indeed it was warned by the enforcement arm NYSE Regulation Inc. back in February that it might be de-listed. But then the exchange suspended the dollar-a-share rule until the end of June, so McClatchy kept trading in the pennies.
After markets closed Friday, though, McClatchy disclosed that on April 14 it got another warning from the NYSE: Its market cap and shareholder equity are too low. NYSE-listed companies have to maintain a market capitalization and shareholder equity of at least $75 million, and MNI hasn’t been able to do that for a while. When it went 30 consecutive trading sessions below the market cap minimum, thecompliance notice kicked in.
Friday’s close of 58 cents a share indicates a market cap of just $48.17 million. McClatchy said in its recently filed annual report that shareholder equity was $52.4 million.
The parent of The Miami Herald and Kansas City Star now has 45 days to come up with a plan to get into compliance, and another 18 months to actually be in compliance. Of course, that’s theoretically the process -- because the Big Board hasn’t shown a lot of patience with newspaper stocks. Last year, three publishers -- Sun-Times Media Group, Journal Register Co., GateHouse Media -- were de-listed. Like McClatchy Friday, they had said they intend to develop a compliance plan.
MORE: NYSE to McClatchy: Shape Up, or Ship Out