By: Mark Fitzgerald Lee Enterprises said late Tuesday it is not going ahead with a reverse stock split that would raise its share price, which currently costs about as much as a copy of one of its dailies.
Lee sought and got shareholder authorization last March for a reverse stock split that could have turned anywhere from five shares to 10 shares into a single share. The authority to make the split expired Tuesday, Lee said.
The Davenport, Iowa-based parent of the St. Louis Post-Dispatch and dozens of community papers considered the stock split after it was warned by the New York Stock Exchange that it was not in compliance with the continuous listing standard of $1 a share. The exchange has since suspended that listing standard through July 31, giving Lee until next Dec. 3 to come into compliance.
Lee has been listed on the Big Board since 1978.
Chairman and CEO Mary Junck said that in deciding not to implement the reverse split, the board of directors looked at current market conditions, forecasts and other factors including the chances of remaining in listing compliance with the Big Board.
"Despite recent volatility in Lee's share price, owing in part to index rebalancing, we believe our long-term prospects remain strong and will become apparent to more investors as the recession begins to recede," Junck said. "We believe our recent debt refinancing has given us ample flexibility to manage through the downturn."
Tuesday, Lee stock (NYSE: LEE) closed at 54 cents, up 2 cents, or 3.65%.
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