Wheeler Real Estate Investment Trust, Inc. (NASDAQ:WHLR), whose stock has declined over 98% in the past year according to InvestingPro data, has announced a one-for-four reverse stock split of its common stock, set to take effect at market open on Monday, January 28, 2025.
The Virginia-based real estate investment trust filed the necessary amendments to its charter with Maryland's State Department of Assessments and Taxation, which will see the par value of its common stock decrease from $0.04 to $0.01 per share after the split.
The reverse stock split is designed to consolidate outstanding shares of common stock by converting every four shares into one share. Stockholders will not receive fractional shares in the process; instead, they will be compensated with cash payments based on the closing price of the company's common stock on The Nasdaq Capital Market on the day of the split, adjusted for the reverse stock split. With the stock currently trading at $2.26 and showing significant volatility, InvestingPro subscribers have access to 11 additional key insights about WHLR's market performance and financial health.
Trading under a new CUSIP number (963025838), the common stock's relative ownership percentages will not be significantly altered, except for minor changes due to the cash payouts for fractional shares. The reverse stock split will also proportionally adjust the conversion rates and prices for the company's various convertible securities and preferred stocks.
This includes a recalibration of the conversion rate for Wheeler REIT's 7.00% subordinated convertible notes due 2031, as well as adjustments to the conversion price for its Series B and Series D Convertible Preferred Stock.
Incentive plans such as the 2015 Long-Term Incentive Plan and the 2016 Long-Term Incentive Plan will also see proportional adjustments to reflect the reverse stock split. The company's authorized shares of common stock will not change due to the reverse stock split, and the trading symbol for Wheeler REIT will remain the same.
The announcement includes forward-looking statements regarding the expected impact of the reverse stock split on the company and the trading price of the common stock. However, these statements are subject to risks and uncertainties that could cause actual results to differ materially from expectations.
This news is based on a press release statement from Wheeler Real Estate Investment Trust, Inc. and reflects the company's latest strategic move to restructure its capital. Despite recent challenges, the company maintains a current ratio of 1.3, indicating its ability to meet short-term obligations. According to InvestingPro Fair Value analysis, WHLR appears to be trading below its intrinsic value, though investors should conduct thorough due diligence given the company's volatile performance history.
In other recent news, Wheeler Real Estate Investment Trust, Inc. has been actively managing its financial operations and stock structure. The company has completed an equity swap with its preferred stockholders, resulting in the issuance of over 1 million common shares in exchange for Series D and Series B Convertible Preferred Stock. This strategic move, analyzed by InvestingPro, was aimed at managing Wheeler REIT's capital structure and providing liquidity to its preferred stockholders.
Additionally, the company has adjusted the conversion price of its 7.00% Subordinated Convertible Notes due 2031 to approximately $2.06 per share. This adjustment was a result of the redemption of its Series D Preferred Stock and represents a 45% discount to the previous conversion price.
Wheeler REIT has also announced a one-for-two reverse stock split and a decrease in the par value of its common stock. This decision is part of the company's ongoing adjustments to its financial structure. Furthermore, the company has decided to pay the interest due on its 7.00% Subordinated Convertible Notes due 2031 in the form of Series D Cumulative Convertible Preferred Stock.
In governance news, the company recently welcomed Rebecca Musser to its Board of Directors. Wheeler REIT's S-11 registration statement was also approved by the Securities and Exchange Commission, enabling the issuance of over 20 million shares of common stock for the redemption and conversion of its Series D Cumulative Convertible Preferred Stock.
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