After the first attempt to implement the strategy to stay on the NASDAQ through a reverse stock split failed at the end of July, this month Generex Biotechnology Corp. (NASDAQ:GNBT
, GNBT message board
) uses some alternative means to raise the value of its stock.
Since the beginning of the month, GNBT is paying to stock promoters to increase investor interest towards the stock. Yesterday, according to another promotional disclosure, the company has paid $16,000 in cash to a stock promoting website to include the stock on its list of favored small cap companies and to alert it to its subscribers. Previously, about two weeks ago, another famous stock promoter also advertised GNBT and received the same cash compensation, again paid directly by the company.
The delisting from NASDAQ for Generex Biotechnology stays under consideration since the summer of 2008 and currently the reverse stock split appears to be the only chance of GNBT to raise the trading price of its stock and regain compliance with the NASDAQ listing requirements. After the grace period has been extended a number of times since 2008, the final deadline to achieve a closing bid price of above $1 on ten consecutive days was May 5, 2010.
On that day, the stock closed at $0.39 and the condition for the suspension to be canceled once again was to obtain shareholder approval for a reverse stock split at a sufficient ratio. The first attempt for approval failed at the end of July.
The alternative management plan to involve stock promoters in raising the price of GNBT shares obviously did not require shareholder approval, but as seen on the chart, did not have the desired results either. All the attempts to pump GNBT share price have all ended up in a short-term momentum and the stock cannot even approach the value of $0.50, not to speak about the desperately needed $1 for a share. Yesterday, the share price lost 1.05% and closed at $0.47 on a trading volume of 4.43 million shares.
On Monday, the company invited its stockholders to attend a special meeting that will be held on September, 17. The reverse stock split at an exchange ratio of not less than 1-for-2 and not more than 1-for-10 will be voted once again. Until the results come out, the NASDAQ delisting is still pending and as it seems, may occur any time.