Anthracite Capital Inc. (AHR), a real estate finance company operating as a real estate investment trust (REIT), has recently announced that it has received a notice from the New York Stock Exchange (the NYSE) for non-compliance of the continued listing standards.
The NYSE continued listing standards require the average closing price of a common stock of a company to be above $1.00 per share over a period of 30 consecutive trading days. In order to avoid a possible delisting of shares for non-compliance, Anthracite Capital has decided to have a reverse stock split to bring its share price above $1.00 per share.
However, for the reverse stock split action, Anthracite Capital would require shareholder approval in its next annual meeting of shareholders, which is scheduled to take place on May 18, 2010. The company should implement the reverse stock split soon after its shareholder meeting to avoid delisting of shares. During the interim period, the common shares of Anthracite Capital would continue to be listed on the NYSE under the “AHR” symbol with a “.BC” indicator to signify its non-compliance.
Anthracite Capital is externally managed by BlackRock Financial Management, a subsidiary of BlackRock, Inc. (BLK). Anthracite Capital earns a spread between the interest earned on various mortgages and the cost of its borrowings by underwriting and acquiring higher yielding commercial mortgage-backed securities (CMBS).
The company generally invests in relatively low-credit quality pools of CMBS and other debt instruments. Anthracite Capital also engages in mezzanine and second lien lending, bridge and acquisition lending, and in participating debt and preferred equity.
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