New York Stock Exchanges acts to delist The Container Store
The Container Store has received more bad news.
The New York Stock Exchange has started proceedings to delist the common stock of the struggling organizing solutions and custom spaces retailer retailer from the NYSE. Trading in The Container’s Store common stock has been suspended immediately.
The decision was made because the company’s common stock had fallen below the NYSE’s continued listing standard. The standard requires listed companies to maintain an average global market capitalization over a consecutive 30 trading day period of at least $15 million.
Although The Container Store has the right to appeal the decision, the retailer does not plan to exercise its right, according to a filing with the U.S. Securities and Exchange Commission. The NYSE plans to remove the company’s listing and registration on Dec. 23.
In May, the NYSE warned the Container Store that was risk of being delisted. The retailer’s board of directors approved a 1-for-15 reverse stock split as subsequently approved a 1-for-15 reverse stock split to help combat the delisting.
The Container Store has been working to improve its performance and sales slump. Sales fell fell 10.5% to $196.6 million in the company’s second quarter, which ended Sept. 28. Comparable store sales were down 12.5%
In October, the Container Store entered into a partnership with Beyond Inc., parent company of Bed, Bath & Bath and other online brands. As part of the deal, and among other things, Beyond would invest $40 million in The Container Store in exchange for a 40% equity stake. The investment came five months after The Container Store, whose net sales fell, said it was launching a strategic review of the business.
However, in late October, Beyond said it was not moving forward with its planned investment in The Container Store since the company has been unable to secure new financing on terms commercially acceptable to Beyond.
“When we signed the purchase agreement, we were optimistic that The Container Store would be able to secure adequate financing to support the business going forward," said Marcus Lemonis, executive chairman of Beyond. "While we continue to believe in The Container Store’s brand and business fundamentals, the proposed financing terms we have reviewed to date fall short of what we believe is necessary to complete the transaction.”
