In a bid to raise the flagging price of South Financial Group stock, the board is urging shareholders to approve an amendment to the company’s articles of incorporation to effect a reverse stock split of major proportions, according to information filed with the US Securities and Exchange Commission Friday.
Shareholders will vote on the amendment at the company’s annual meeting, May 18 in Greenville.
If approved, the amendment would permit but not require the board to “effect a reverse stock split of our common stock at any time prior to November 30, 2010 by a ratio of not less than one-for-five and not more than one-for-fifty,” according to the SEC filing.
At the same time, the board will ask shareholders to approve an amendment to set the number of authorized shares of common stock at 1.35 billion shares.
“The Board of Director’s primary objective in proposing the Reverse Split is to raise the per share trading price of our common stock so as to cause and maintain compliance with the NASDAQ listing requirements,” according to the SEC filing.
Shares in South Financial closed at 69 cents Friday; It was trading for as much as $15 a share in 2007. Over the past two years TSFG has lost more than $1.3 billion.
Regarding the reverse stock split proposal, South Financial stated that NASDAQ listing requirements generally require a bid price in excess of $1 and the company believes the liquidity and marketability of its common stock will be adversely affected if it is not quoted on a national securities exchange.
In addition, it can be harder for investors to dispose of or to obtain accurate quotations on stock not listed on a national exchange.
Increasing the market price of TSFG’s stock will make it more attractive to a broader range of institutional and other investors, the company believes.
In terms of issuing extra stock, Greenville-based South Financial is currently authorized to issue 325 million shares of common stock. As of March 15, 2010, there were 215.6 million shares outstanding and nearly 109.4 million unissued.
Of the latter amount, about 18.2 million shares were reserved for issuance under our dividend reinvestment plan, employee stock purchase plan, equity incentive plans, conversions of outstanding preferred shares, and other outstanding warrant agreements, leaving 91.2 million shares available for future issuance.
Apparently, being public relations savvy is not a prerequisite to high office in Turkey.
The country’s prime minister has warned that he might deport up to 100,000 Armenians living in Turkey after recent resolutions passed by US and Swedish lawmakers defined World War I-era killings of Armenians by Ottoman Turks as genocide, according to Reuters.
Recep Tayyip Erdogan, asked during an interview with the BBC Turkish service in London on Tuesday what he thought about the resolutions, threatened to expel those Armenians living within Turkey who aren’t citizens of his country.
“There are currently 170,000 Armenians living in our country,” the Turkish prime minister said. “Only 70,000 of them are Turkish citizens, but we are tolerating the remaining 100,000. If necessary, I may have to tell these 100,000 to go back to their country because they are not my citizens. I don’t have to keep them in my country.”
Earlier this month, Turkey withdrew its ambassadors to Washington and Stockholm after a US congressional committee and the Swedish parliament passed the non-binding resolutions.
It also warned that the resolutions could affect progress in fragile reconciliation process between Turkey and Armenia, according to Reuters.
“Erdogan’s comments threaten to strain Turkish-Armenian ties, which are traumatized by the deportation and killing of Armenians during the chaotic end of the Ottoman empire nearly a century ago,” the news service reported.
The issue of the Armenian massacres is deeply sensitive in Turkey, which accepts that many Christian Armenians were killed by Ottoman Turks but vehemently denies that up to 1,5 million died and that it amounted to genocide — a term employed by many Western historians and some foreign parliaments, Reuters added.
The Armenian Genocide is described as the deliberate and systematic destruction of the Armenian population of the Ottoman Empire during and just after World War I. It was characterized by the use of massacres, and the use of deportations involving forced marches under conditions designed to lead to the death of the deportees, with the total number of Armenian deaths generally held to have been between 1 million and 1.5 million.
Other ethnic groups were similarly attacked by the Ottoman Empire during this period, including Assyrians and Greeks, and some scholars consider those events to be part of the same policy of extermination. It is widely acknowledged to have been one of the first modern genocides.