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Print Edition StoriesTuesday, November 24, 2009
TranSwitch pulls off 1-for-8 reverse stock split
By Mass High Tech Staff
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As it had previously announced, TranSwitch Corp. has pulled the trigger on a planned one-for-eight reverse stock split in an effort to bring the company’s common stock in compliance with Nasdaq trading regulations.
The total number of TranSwitch shares of common stock issued and outstanding have been reduced from approximately 160 million shares to approximately 20 million shares. Shelton, Conn.-based TranSwitch, a maker of semiconductors for the communications market, says its stock will have the letter “D” appended to its ticker symbol of “TXCC” for 20 trading days to indicate the reverse stock split has occurred, beginning today.
TranSwitch (Nasdaq: TXCC) stockholders authorized the reverse stock split at the company’s 2009 annual meeting on May 21, 2009.
Earlier this month the Transwitch board also approved the appointment of new CEO M. Ali Khatibzadeh, following the resignation of 20-year CEO and company founder Santanu Das. Khatibzadeh will hold the CEO role as of Dec.1, 2009.
In December of 2008, TranSwitch purchased $15 million worth of its $25 million in outstanding convertible notes, issued in July of 2007. The firm paid $9.9 million, plus accrued interest, for the notes. For 2008, TranSwitch lost $17 million on revenue of $42 million.
The reverse stock split should allow the company to reestablish compliance with the Nasdaq rule requiring a $1 minimum closing bid price, according to TranSwitch officials. Nasdaq officials had told TranSwitch (Nasdaq: TXCC) it would be required to show its plans for compliance with the minimum closing bid price requirement by last Friday, Nov. 6, 2009. On Nov. 9, TranSwitch received a letter from Nasdaq staff that it was not in compliance and faced possible delisting.
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