NEW YORK — Unable to meet Nasdaq listing standards, better apparel producer Marisa Christina Inc. said its shares would cease trading on the exchange on Monday and move to over-the-counter trading.
“We are delisting from Nasdaq, but are not deregistering from reporting with the Securities and Exchange Commission at this time,” chairman Michael Lerner said in a statement.
The company’s third-quarter results reflected stockholder equity of $8 million, below the Nasdaq listing minimum of $10 million.
Shares of the firm dropped 14 cents, or 11.7 percent, to close at $1.06 Tuesday.
Losses for the three months ended Sept. 30 came to $5.8 million, or 79 cents a share. This compared with earnings of $1.1 million, or 15 cents, a year earlier. Lower sales to a private label account contributed to a 19.1 percent drop in sales to $8.4 million.
The New York-based firm is considering strategic options, including mergers, acquisitions, divestitures, recapitalizations and share repurchases.
“We will probably have more to say about them by mid-January,” Lerner said during an interview.
Costs to meet the requirements of the Sarbanes-Oxley Act, which compels companies to document their safeguards against financial wrongdoings, also have been pressuring the firm, he said.
“Hundreds and hundreds of companies over the past couple of years have actually delisted [since the act took effect],” Lerner said.
Being publicly held might be one of the firm’s selling points to potential bidders. A person familiar with the company’s situation said a privately held company seeking to get into the public markets could do so by cutting a deal with Marisa Christina.
This story first appeared in the December 22, 2004 issue of WWD. Subscribe Today.