ChinaNet (CNET) Plans 1-for-2.5 Reverse Split
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ChinaNet Online Holdings, Inc. (Nasdaq: CNET) ("ChinaNet" or the "Company"), a leading B2B (business to business) Internet technology company providing online-to-offline (O2O) sales channel expansion, business strategies and marketing solutions for small and medium-sized enterprises (SMEs) by utilizing data analysis and cloud computing technologies in the People's Republic of China, today announced a 1-for-2.5 reverse stock split of its issued and outstanding shares of common stock, which will be effective for trading purposes as of the commencement of trading on Friday, August 19, 2016.
The reverse stock split is intended to increase the per share trading price of the Company’s common stock to satisfy the $1.00 minimum bid price requirement for continued listing on The NASDAQ Capital Market. Trading of the Company’s common stock on The NASDAQ Capital Market will continue, on a post-split basis, with the opening of the markets on Friday, August 19, 2016, under the existing trading symbol “CNET” under the new CUSIP # 16949H 201. The reverse stock split reduces the number of shares of the Company’s common stock outstanding from approximately 30.4 million shares of common stock pre-reverse split to approximately 12.2 million shares of common stock post-reverse split.
The number of authorized shares of common stock and the par value per share will remain unchanged. As a result of the reverse stock split, every 2.5 shares of the Company’s pre-reverse split common stock will be combined and reclassified into 1 share of common stock. The number of outstanding options will be adjusted accordingly, with outstanding options being reduced from approximately 2.1 million to approximately 835,000. No fractional shares will be issued in connection with the reverse stock split. Stockholders who would otherwise hold a fractional share of common stock will receive an increase to their common stock as the common stock will be rounded up to a full share.
“Management and the Board of Directors agree that it is favorable for investors that ChinaNet’s shares continue to trade on the NASDAQ Capital Market stock exchange and this reverse split will fulfill the minimum share price requirement for continued listing,” said Handong Cheng, Founder, Chairman and Chief Executive Officer of ChinaNet. “The Company has undergone a major transformation to an internet and data service focused entity and we expect the benefits of that shift to be represented in our top line growth in the second half of 2016 and beyond. This transition will further strengthen our relationships with major internet companies in China and empower our ability to cooperate with other US based internet companies. We plan to provide a comprehensive update to our shareholders and investors within the next 30 days.”
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