Usually delisting from a senior exchange and filing bankruptcy is crippling to a stock price. That is not the case for Global Brokerage (NASDAQ:GLBR), as debt holders wanted to see a change. In fairness, the stock has gotten crushed lately, but big bounces have put it back near where the collapse started on a couple occasions. The news of de-listing first was disclosed back in November, with a follow-up announcement after Friday's closing bell.
The reality is the de-listing was in the cards anyway, with GLBR failing to meet continued listing market capitalization requirements of NASDAQ. The New York-based company, whose principle asset is its 50.1% equity ownership in foreign exchange and trading services company FXCM Group, has a market cap under $5 million. As the stock plummeted in recent weeks, the value went even approached the $1-million mark.
FXCM issued a statement in August explaining GLBR's debt problem was not its problem, allaying any potential FXCM customer fears as GLBR was coming apart at the seams.
After Monday's closing bell, Global Brokerage said the 78.5% of holders of its 2.25% convertible notes due 2018 approved the plan of reorganization that included the company filing Chapter 11 bankruptcy. In the long run, the reorganization is meant to swap the current debt for new notes with a longer window to maturity, while revamping operations and slashing expenses.
Daytraders are having a field day with GLBR stock, highlighted by volatile swings up and down day after day on a surge in volume. Shares are again one of the biggest movers on NASDAQ (while they're still there anyway), opening at 52 cents, falling as low as 41 cents (-21.2%), climbing as high as 87 cents (+67.3%) and currently trading at 73 cents (+41.0%) as the closing bell approached.
This is a daytrader frenzy stock and by no means for the faint of heart, so inexperienced traders need to beware.
