The bankruptcy proceedings carrying Chemtura Corporation (OTC:CEMJQ
) is still losing value on the market, following the announced plans to emerge from Chapter 11 protection in the coming few months.
Stock price slipped 66% in just one month since the end of May. The steep decline wasn't affected by positive corporate announcements, like the new long term contract with Odyssey Logistics & Technology.
The decline rate has been slowing down over the past week, but is still affected by the presented plan of reorganization, under which 98% dilution to shareholders is presented and $0.27 per share valuation is forced upon the entity. Naturally, the current share price is adjusting accordingly.
Currently listed on the pink sheets, the company remains a large international entity, with significant prospects of recovery once the restructuring is dealt with. Upcoming changes in the share count and ownership structure will hurt the current holders, but leave the company with stronger base for future value growth.
Chemtura filed for Chapter 11 protection back in March 2009. Under the restructuring efforts, the company sold their PVC Additives business in May this year and together with subsidiaries filed a Joint Plan of Reorganization on June 17. The bankruptcy court has accepted the plan, under which Chemtura should emerge from Chapter 11 protection in the coming months.