Sequential Brands (NASDAQ:SQBG) stock is falling hard on Tuesday after the brand management company announced Chapter 11 bankruptcy filings.
Let’s take a look at what all investors in SQBG stock need to know about today’s bankruptcy news.
- To start off with, the bankruptcy filing made by Sequential Brands is voluntary.
- It’s also worth pointing out that it’s taking place via the U.S. Bankruptcy Court for the District of Delaware.
- The company is deciding to go forward with bankruptcy due to its current amount of debt.
- It says that this won’t allow it to ‘operate its portfolio of brands.”
- As a result of that, Sequential Brands says that it will “pursue the sale of all or substantially all of its assets under Section 363 of the U.S. Bankruptcy Code.”
- This will have it seeking permission to hold an auction for its brands to obtain their maximum value.
- The company says that it believes each of its brands “is well-positioned for profitability under the stewardship of new owners.”
- To go along with all of this, Sequential Brands is obtaining $150 million in debtor-in-possession financing.
- According to the company, this funding will allow it to continue normal operations through the bankruptcy process.
- Gibson, Dunn & Crutcher LLP, and Pachulski Stang Ziehl & Jones LLP are acting as legal counsel to Sequential Brands during the bankruptcy.
- Stifel, along with its affiliate Miller Buckfire & Co., are acting as the company’s investment banker.
- SQBG stock is seeing heavy trading today with nearly 2 million shares on the move.
- For comparison, the stock’s daily average trading volume is about 1.1 million shares.
SQBG stock was down 50.4% as of Tuesday morning.
Investors looking for more stock news today will want to stick around!
We’ve got all the latest stock market coverage traders need for Tuesday. That includes what has shares of Lightning eMotors (NYSE:ZEV), Corsair Gaming (NASDAQ:CRSR), and Zoom Video Communications (NASDAQ:ZM) on the move today. You can learn all about these matters at the links below!
More Tuesday Stock Market News
- ZEV Stock: 6 Things to Know About New Short-Squeeze Target Lightning eMotors
- CRSR Stock: What to Know About Meme Stock Corsair Gaming Today Amid the WSB Chatter
- ZM Stock Alert: 8 Reasons Why Zoom Video Is Tumbling Today
On the date of publication, William White did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
With only the rarest exceptions, InvestorPlace does not publish commentary about companies that have a market cap of less than $100 million or trade less than 100,000 shares each day. That’s because these “penny stocks” are frequently the playground for scam artists and market manipulators. If we ever do publish commentary on a low-volume stock that may be affected by our commentary, we demand that InvestorPlace.com’s writers disclose this fact and warn readers of the risks. Read More: Penny Stocks — How to Profit Without Getting Scammed