K-TEL STOCK IN 11TH HOUR
The company responded by filing an appeal to the decision.
Nasdaq requires listed companies to have a market capitalization or assets and revenues totaling at least $50 million. As of market close on Wednesday (8/9), K-tel's capitalization (which includes the "K" but not the "T") had fallen to $18.7 million.
"The company is in turnaround and looking at a wide variety of options [to maintain its Nasdaq listing]," said K-tel CFO A. Merril Ayers. The company does not expect to be delisted come Monday morning, Ayers said, since Nasdaq must decide the appeal before any action is taken. Ayers also mentioned that the company has applied to be listed on the Nasdaq Small Cap market.
The market warned K-tel of this action as long ago as May (hitsdailydouble, 5/12). At that time, company spokesman Steven Kahn said, "Basically, our stock needs to trade at about $5 a share to meet the $50 million market cap."
In early trading today, K-tel's stock was still hovering around $1.13 a share—down more than 80 percent for the year.
The delisting warning comes as K-tel struggles to overhaul its business. In July, the company closed its German operations and cut 88 jobs as a cost-saving measure. It also cut 35 jobs in the U.S. in June and combined its two U.K.-based operations into one facility in April.
