Facing a delisting from the Nasdaq Capital Market, Stony Brook-based Applied DNA Sciences Inc. announced a planned reverse stock split of its shares Thursday.
In an announcement, Applied DNA said it would institute a 1-for-40 reverse split of its outstanding common stock effective Friday, meaning every 40 shares of its stock will be converted into one share. Reverse stock splits are a method used to raise the stock price of individual shares.
The company, which provides molecular technologies to help businesses authenticate goods and identify counterfeit products, received a delisting notice in January due to its failure to maintain a minimum stock price of $1 per share and a minimum stockholders’ equity of $2.5 million or net income from continuing operations of at least $500,000.
A Nasdaq hearings panel granted the company’s request for an extension to Dec. 31 for Applied DNA to regain compliance, the company said recently.
“The reverse split has had very solid support from stockholders, and from the board of directors. We believe the change in capital structure can strongly benefit our stockholders,” James A. Hayward, chairman, president and chief executive of Applied DNA said in a statement.
The company previously enacted a 1-for-60 reverse stock split in 2014.
Shares of Applied DNA closed down 11.5% Thursday to 17 cents.