Gottschalks kicked off New York Stock Exchange
| Tuesday, Oct 21 2008 07:20 PM
Last Updated Friday, Mar 27 2009 12:58 PM
Images
Melissa Burton, visual manager at Gottschalks in East Hills Mall, puts some finishing touches on a display at the newly renovated store in this photo from May.
Fresno-based department store chain Gottschalks Inc. is set to be delisted from the New York Stock Exchange starting Monday because the company’s market value has fallen below $25 million.
NYSE’s decision is essentially a determination that the company — which has two department stores in Bakersfield — is now too small to be traded on the prominent exchange.
Gottschalks’ depressed stock price clearly contributed to the decision. In April of last year, Gottschalks shares were trading at about $14; since July they have traded below $2.
“In recent months, the challenges in the macroeconomic environment have intensified due to unprecedented and mounting events in the financial markets,” Chairman and CEO Jim Famalette said in a news release dated Tuesday. “Clearly, these challenges have had an adverse effect on our stock performance.”
Gottschalks said it plans to appeal the NYSE’s decision, a process that would take at least 25 business days. In the meantime, the company’s stock is expected to be traded on the OTC Bulletin Board, a large but less prominent exchange whose stocks include Microsoft.
Bakersfield financial adviser John Rodgers said the NYSE’s decision “seemed readable” because of Gottschalks’ poor stock performance.
“They certainly won’t be as high-profile on (the OTC) versus the New York (exchange),” he said.
Gottschalks has locations at Valley Plaza and East Hills Mall. A company representative said earlier this year that Bakersfield is one of the company’s four best markets among 58 stores ranging from the Inland Empire north to Alaska.
The company said its operations will not be affected by the NYSE’s decision.
According to Gottschalks’s news release, the NYSE informed the company Tuesday that its global market capitalization — calculated by multiplying its total outstanding shares by its stock price — fell below the $25 million threshold over 30 consecutive trading days.
A company spokesman could not be reached for comment Tuesday afternoon.
Gottschalks said it continues to work on a proposed transaction with Everbright Development Overseas Ltd. in which the British Virgin Islands corporation would invest $30 million in the company to “enhance our operations.”
