AGR Tools, Inc. (PINK:AGRT) experienced a massive sell-off during yesterday’s trading session which led to a large percentage loss in value. There was no news but an information statement from the company filed on Friday last week. AGRT.png

Yesterday, trading volume of AGRT exceeded at least several times the daily average for the past three months as over 8.9 million shares were traded in a day. The closing price of $0.0047 per share represented a 66.43% loss from the previous close. Moreover, AGRT made a huge gap down already at market open.

Last Friday, AGR Tools filed a preliminary information statement to the SEC which looks like the most likely reason for the negative reaction on the market. Through to the filing, AGRT informs its stockholders that its Board of Directors and the majority of the shareholders have approved a reverse stock split of the company’s outstanding shares of common stock by a ratio of 500:1.

Further, the statement says that the reverse split should become effective on or around March 16, 2012, or as soon as regulatory approval is obtained. As of December 2011, AGRT had 91,823,986 issued and outstanding shares of common stock.AGR_Tools.jpg

According to the company’s latest 10-Q filing, it was incorporated in December, 2004 and is engaged in manufacturing diamond tooling and related products. A reverse split would barely solve AGRT severe liquidity problems, though. At the end of last year, it had a working capital deficit, no substantial assets and total debts for around $914,000. In the last quarter of 2011, AGRT revenues declined by nearly 70% on a year-over-year basis.