Tuesday, November 20, 2012

YRC Plummets: Brother, Can You Spare 8 Cents?

YRC Worldwide (YRCW) stock plunged after shareholders agreed to increase the trucking company’s share count to 1.9 billion from 48 million, a massive dilution of exiting shareholders. The increase is part of the company’s restructuring plan to avoid bankruptcy.

Shares dropped 74% to 8 cents.

Of course, when your stock is trading at 8 cents, it tends to signal to the market that the risk of bankruptcy is very high. The company plans to conduct a reverse split this December or January to boost the price over $1, Chief Financial Officer Jamie Pierson toldDow Jones.

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