WESTPORT, Conn. - Portage Biotech Inc. (NASDAQ: PRTG), an immuno-oncology company, declared that its Board of Directors has authorized a reverse stock split of its ordinary shares at a ratio of 1-for-20, set to take effect with the opening of trading on August 15, 2024. This strategic move aims to elevate the per-share trading price to satisfy the Nasdaq Capital Market's minimum bid price criterion for continued listing.
The reverse stock split will transform every twenty existing ordinary shares into a single post-split share. Any fractional shares from the split will be rounded up to the nearest whole share, maintaining shareholders' proportional interest in the company, barring minor adjustments due to fractional rounding.
The adjustment will also extend to all outstanding options and warrants to purchase ordinary shares, aligning with the terms of each security. Similarly, the number of shares reserved for future issuance under the company's equity incentive plans will be recalibrated.
Portage's authorized share count remains unaffected by the split, as the company, under British Virgin Islands law, is permitted an unlimited number of authorized shares. Shareholders will receive guidance from the company's transfer agent, TSX Trust Company, on the procedure for exchanging share certificates.
In addition to the reverse stock split announcement, Portage has decided to halt its sponsored trial for its invariant natural killer T-cell (iNKT) program and pause patient enrollment in its adenosine trial program (ADPORT-601 trial). The company is actively exploring strategic alternatives, which may involve partnerships, a sale, mergers, restructurings, a wind down, additional financing, or other strategic actions.
This action is based on a press release statement and reflects the company's current strategy and compliance efforts with market listing requirements. Portage Biotech has not provided any further details on the potential outcomes or timing of its strategic review process.
InvestingPro Insights
In light of Portage Biotech Inc.'s (NASDAQ: PRTG) recent announcement regarding its reverse stock split and strategic alternatives exploration, it's important for investors to consider the company's financial health and market performance.
Based on the latest InvestingPro data, Portage Biotech holds a market capitalization of a mere 2.97 million USD, reflecting its small size within the biotech industry. The company's Price / Book multiple, as of the last twelve months leading up to Q3 2024, stands at 0.09, suggesting that the stock may be trading at a low valuation relative to the company's book value. This could be an indicator of potential undervaluation, a point of interest for value-oriented investors.
However, the financial metrics also reveal challenges. Portage Biotech has been experiencing significant losses, with an Operating Income of -18.97 million USD and a Return on Assets of -111.6% for the same period. These figures underscore the financial difficulties the company faces, with profitability remaining out of reach in the near term. Moreover, the stock's price has seen a sharp decline, with a year-to-date total return of -91.74%, highlighting the market's bearish sentiment towards the company's prospects.
Among the InvestingPro Tips, it's noted that Portage Biotech holds more cash than debt on its balance sheet, which can provide a cushion against financial strain and offer some degree of operational flexibility. Furthermore, the company's net income is expected to grow this year, providing a glimmer of hope for a turnaround in its financial performance. These insights are crucial for investors considering the company's future, especially in the context of its strategic review process and the search for potential partnerships or mergers.
For those interested in a deeper analysis, there are additional InvestingPro Tips available, which can provide further clarity on the risks and opportunities associated with Portage Biotech. With 17 more tips listed on InvestingPro, investors can gain a comprehensive understanding of the company's financial standing and market position.
As Portage Biotech navigates its strategic alternatives, keeping an eye on these financial metrics and insights will be key for stakeholders to understand the implications of the company's efforts to maintain compliance with market listing requirements and to potentially enhance shareholder value in the long run.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.