About a month after registering its shares in ShopNBC with the SEC for sale to the public, NBC Universal has had a change of heart. It will hold onto its nearly 6.5 million shares.
ShopNBC, which still uses the stock ticker “VVTV” from its former ValueVision name, issued this announcement Thursday morning:
“ShopNBC, the premium lifestyle brand in multi-media retailing, today announced that NBC Universal, Inc. has decided not to pursue its offering of 6,452,194 common shares in the company at this time due to prevailing prices. A shelf registration statement relating to these securities was previously filed and declared effective by the Securities and Exchange Commission. NBC Universal, Inc. is one of the company’s largest shareholders.”
ShopNBC’s stock price had dropped below $2.00 after NBCU had exercised its contractual right to have its shares registered for sale and had not managed to get back to even $2.50 in subsequent trading. The 52-week high for the stock was $5.27. It closed Wednesday at $1.73 and moved up modestly after the announcement that NBCU would not be selling.
RBR-TVBR observation: The issue of whether or when NBCU might decide to cash out will remain as an overhang that may discourage some on Wall Street from buying the ShopNBC stock. No doubt it will look again at doing so when the stock price gets a lot better – and what will bring that about will be a reversal of the sales decline reported for Q1. Are better days ahead for the TV shopping business?