another fave gets voted off the island...
biz.yahoo.com
these guys had a huge equity deal all lined up at +/- $40 about a year ago, then pulled it 'cause the stock was "too cheap".
i expect the CFO will get a $2mm stay bonus in recognition of that brilliant corporate financing move.
cheers
Wednesday December 19, 11:45 am Eastern Time
ACT says in credit default, may seek bankruptcy
(UPDATE: updates with stock activity, background)
NEW YORK, Dec 19 (Reuters) - Contract manufacturer ACT Manufacturing Inc. (NasdaqNM:ACTM - news) on Wednesday said it was in default of its credit agreements and that it was considering filing for bankruptcy protection, sending its shares tumbling.
Shares of ACT, which closed at $1.31 on Tuesday, were down 75 cents, or 55 percent, to 56 cents, on the Nasdaq stock exchange after reaching a 52-week low of 28 cents.
ACT, which recently posted a third-quarter loss and said its business was hurt by the sluggish economy, said its bankers had not agreed to lend it any more money or extend its waivers under the credit agreement. The waiver expired on Dec. 14.
ACT makes electronics components for networking and telecommunications equipment makers, a sector that has been particularly hard hit in the slowdown.
``The company can provide no assurance that it will obtain any of the liquidity that it requires or any of the waivers or consents it requires from the domestic bank syndicate or other parties,'' ACT said in a statement.
As a result, ACT said it is considering a number of actions, including additional layoffs at several locations and the possibility of seeking protection under the federal Bankruptcy Act, in order to preserve its assets and value.
The news comes a day after Solectron Corp. (NYSE:SLR - news), the world's largest contract electronics manufacturer, reported a fiscal $52.5 million first-quarter loss, compared to a profit of $190.6 million a year ago, and said it saw sharp declines in its personal computer and telecommunications operations. Revenues fell to $3.15 billion from $5.70 billion.
The young contract manufacturing industry, specializing in producing electronics for brand-name companies such as Sony Corp. and Cisco Systems Inc. (NasdaqNM:CSCO - news) that prefer to concentrate on developing products, is still proving itself.
After heady early days, the manufacturers have suffered along with customers as the economy has sapped demand for electronics and razor-thin profits have disappeared. |
