THQ announced this morning that stockholders have approved an amendment to THQ’s Certificate of Incorporation to initiate a reverse split of its common stock and have authorized the company's Board of Directors to determine the ratio and the effective date of the reverse stock split. That vote took place at the company’s Special Meeting of Stockholders on June 29.
Following that meeting the Board of Directors determined that it would initiate a 1-for-10 reverse stock split on July 9, 2012.
"The purpose of the reverse stock split is to raise the per share trading price of THQ’s common stock to regain compliance with the $1.00 per share minimum bid price requirement for continued listing of THQ’s common stock on the NASDAQ Global Select Market," the company said in a statement this morning. "As previously disclosed, in order to regain compliance with NASDAQ’s minimum bid price requirement, the common stock must have a minimum closing bid price of $1.00 per share for a minimum of 10 consecutive trading days. There can be no assurance that the reverse stock split will have the desired effect of raising the closing bid price of THQ’s common stock to above $1.00 per share to meet this requirement."
This is just one more step on the road to profitability for the troubled video game publisher. During E3 the company sold off its rights to the UFC brand, which EA picked up happily. Earlier in the year the company cut several projects, laid off hundreds of staff members, closed studios, and moved away from casual and licensed kids properties to focus on core brands.
We will continue to follow this story as it develops.