Now that the 1-for-200 reverse split has been completed, Westwood One has filed an update for its proposed sale of $50 million in stock. There are, however, many blanks which still have to be filled in for the public stock sale to take place.
The first thing we noticed in the amended SEC filing was the notation that the stock now trades on the OTC Bulleting Board with the symbol “WWOZ,” which should be familiar to RBR/TVBR readers. The company notes that it plans to apply to trade on Nasdaq with the symbol “WWON,” which it had used previously for OTC trading after leaving the NYSE.
The prospectus doesn’t yet indicate any price range or how many shares would be sold for the target value of $50 million. As has been indicated from the beginning, some of the shares will be sold by the Gores Group, which owns 75.1% of Westwood One’s equity following the recent restructuring, while some of the offering will be new shares being sold by the company. The cash from selling the new shares will go into the Westwood One coffers, while the Gores Group will receive the proceeds from the shares it sells. The split has yet to be spelled out.
Thomas Weisel Partners LLC is handling the stock sale. We will be watching for further updates before the public offering actually takes place.
RBR/TVBR observation: The good news for Westwood One shareholders is that the stock price has stabilized since the reverse split and is staying out of penny stock territory. Adjusted for the reverse split, the 52-week high was $210, but that’s ancient history. Following the freefall of the past year, the stock is now building a floor in the $7-8 area. It will be interesting to see the pricing when the public offering takes place – and how much of the $50 million sale will come from the Gores Group taking back some cash, rather than Westwood One raising new money.