Vintage Wine Estates warned of Nasdaq exchange delisting
Vintage Wine Estates, maker of dozens of brands such as B.R. Cohn and Ace Cider in Sonoma County and Clos Pegase in Napa Valley, has been warned that it could lose its current listing on a major stock exchange if the price doesn’t rebound.
The Santa Rosa-anchored vintner received a letter Sept. 13 from the Nasdaq Stock Exchange that for 30 consecutive business days its stock bid price — what buyers are willing to pay — fell under the exchange’s $1-a-share minimum for listed companies, according to a regulatory filing Tuesday. The stock’s price was last at $1 as of the closing bell July 26. It rallied from an all-time low of 67 cents Friday to close at 71 cents Tuesday.
“You practically have a whole year to cure the situation,” said Deborah Pawlowski of Kei Advisors, which handles the company’s investor relations.
First comes the initial 180-day “compliance period,” so Vintage has until March 11, 2024, to see its stock trade above $1 for at least 10 consecutive trading days to be back in compliance, according to the filing.
But if the bid price doesn’t clear that threshold, Vintage could apply to shift from the exchange’s Global Market to its Capital Market, potentially restarting the clock for another six months, said Pawlowski and Nasdaq’s rules.
A common tactic companies employ when facing a delisting notice is to pursue a reverse stock split, which reduces the number of shares outstanding but increases the share price.
“We don’t currently have shareholder approval for a stock split,” Pawlowski said.
The Nasdaq exchange’s capital, global and global select market tiers have increasing levels of listing requirements. The Capital Market typically is dominated by businesses with lower levels of market capitalization, or “small cap.”
Vintage debuted on the Nasdaq Global Market in March 2020 at $9.68 a share via a merger with a special-purpose acquisition company, or SPAC. The stock peaked at $12.63 in June 2021 but was under downward pressure throughout last year, dropping just after its quarterly report in mid-September 2022 from about $5.50 to around $3.
The price dropped again in early February of this year from just under $3 when the company announced a restructuring plan that included co-founder Pat Roney out as CEO, President Terry Wheatley stepping up into day-to-day operations and a gutting of about half the number of variations in the portfolio.
The stock dipped below $1 in June but rallied just before a business update July 20. That’s when Vintage noted that Wheatley had just resigned and recent Moët Hennessy North America CEO Seth Kaufman would be coming in as chief executive, effective Oct. 30.
Vintage Wine Estates has its headquarters in Incline Village, Nevada, and its operational main offices in Santa Rosa.
Jeff Quackenbush covers wine, construction and real estate. Reach him at firstname.lastname@example.org or 707-521-4256.
Correction, Oct. 10, 2023: The company headquarters is located in Incline Village.