The McClatchy Co., parent of The Sacramento Bee and 29 other newspapers, said Friday it’s facing possible delisting by its stock exchange, NYSE American.
Sacramento-based McClatchy said it received a warning letter Monday from the exchange, saying the company’s finances had fallen below the exchange’s minimum standards. McClatchy said the exchange cited the company’s losses in each of the past four years and its “stockholders’ deficit” of $372.5 million as of June 30. A stockholders’ deficit means the company’s liabilities exceed its assets.
Also, the company’s market value, as defined by NYSE American, falls below the $15 million minimum. The exchange’s rules exclude the market value of the Class B shares, which are mainly controlled by members of the McClatchy family, and shares held by two institutions that each own 10 percent stakes in the company. Otherwise, its market value would top $23 million, putting it above the exchange’s minimum.
Delisting wouldn’t affect the company’s operations, McClatchy said in a press release. But it would force the company to find another stock exchange.
The company has 18 months to get back into compliance with NYSE American standards and plans to submit a plan by Oct. 9 explaining how it will achieve that.
McClatchy went from the New York Stock Exchange to its affiliate, NYSE American, in 2017. The American exchange is reserved for smaller companies. McClatchy, like other media companies, has been struggling with the transition from print to digital journalism over the past decade, causing deep slides in revenue and profitability.
McClatchy stock closed Friday at $2.57 a share.