Shareholders of less-than-truckload carrier YRC Worldwide Inc. today approved a 1-to-300 reverse stock split, a move that will reduce the number of outstanding shares to 6.8 million from the current 2 billion, the company said.
The vote, taken at the company's annual shareholder meeting at YRC's Overland Park, Kan., home base, is designed to provide a boost to the stock price by removing a large number of shares from the market. The split takes effect Dec. 2.
By reducing the supply of shares, the company hopes to push the stock price above $1 a share and avoid delisting from the NASDAQ stock exchange, where the company's stock trades.
As of mid-day Nov. 30, YRC shares were trading at three cents a share, down 8 percent on the session.
In mid-September, YRC shareholders approved the issuance of 1.5 billion new shares called for in a July 22 restructuring that effectively kept the carrier out of bankruptcy.
Today's action marks the second time in 13 months YRC shareholders have approved a reverse stock split. In October 2010, shareholders approved a 1-to-25 reverse split to boost the share price above $1.