Office Depot (NASDAQ:ODP) has undergone a reverse stock split in an attempt to bolster the value of the company’s stock.
Here’s what investors need to know about the Office Depot reverse stock split.
- The reverse stock split takes place on a 1-for-10 ratio and went into effect on Tuesday.
- This has the company reducing its outstanding share count from 526 million shares to 52.6 million shares.
- The reverse stock split doesn’t allow for fractional shares.
- Any investors that would receive fractional shares of ODP stock will instead be granted cash equal to the value of those shares.
- This also doesn’t affect the overall ownership of investors in the company.
- The plan was approved by investors on May 11 and they don’t have to take any action as a result fo the reverse split.
- To go along with this, Office Depot has undergone a reorganization of the company.
- This has it reorganizing with The ODP Corporation serving as the new holding company for the business.
- The ODP Corporation also takes over as the public company connected to ODP stock on the Nasdaq.
- The ODP Corporation notes that there are several benefits to restructuring as a holding company.
- These include simplifying legal and tax matters, allowing for better management of its operating assets, and improving operational flexibility.
- It’s also worth noting that ODP stock is seeing extra attention from Robin Hood investors after the reverse split.
- The exact reason for this is currently unknown.
ODP stock was down 7.6% as of Wednesday afternoon.
As of this writing, William White did not hold a position in any of the aforementioned securities.