Posted August 05, 2018 12:21:58 The online brokerage company Crossroads Trading Co., based in Dallas, Texas, is making a big splash in the space with a big, bold and fast IPO.
The stock, which is trading on the Nasdaq under the ticker “CRTCX” on the SEC’s website, has been on a roller coaster ride over the last several months, as the company has struggled to get a foothold on Wall Street and in its initial public offering (IPO).
The company has seen its stock plunge to under $100 from $1,500 a share in February 2018, after it was bought by hedge fund Bridgewater Associates, which has since closed.
The company’s stock has dropped further this year, from more than $160 in the middle of 2018 to less than $70 today.
The recent stock price slide has not been good for Crossroads, and the company now has to deal with its debt burden, according to its stockholders.
“We believe that Crossroads is in need of a major restructuring to be profitable,” Crossroads CEO Eric DeLuca told Bloomberg in an interview this week.
“Our debt is unsustainable and we don’t have a lot of cash to invest.
We need to find a buyer that will help us achieve our goals.”
Crossroads has been trading on a number of exchanges since it was listed in March.
Its first listed trade is on Nasdaq on August 4, 2018, and on the NYSE in mid-August.
The price of the stock has fluctuated from $180.40 in mid August to $160.70 today, but that’s mostly been in the last few days.
On Tuesday, the stock closed at $144.00, down from $166.40 on Monday.
On Wednesday, the company filed for a preliminary IPO, and it’s still looking for a buyer.
DeLucas told Bloomberg that the company plans to take a $150 million buyout from its debt holders.
“The debt is in very bad shape,” he said.
“I don’t think we are going to get through this.”
The company will also need to sell some of its assets, including its equity in a few of its trading desks, if it wants to keep its trading options open, which can make trading a tough sell for some investors.
DeMarco said that it’s unclear what Crossroads will do with the debt.
“That is a big question mark for us,” he told Bloomberg.
“When it’s sold, we will sell our entire debt.
We will use the money to buy the debt again, and then sell our debt to a company that has a different strategy.”
The debt issue will also have to be resolved before Crossroads can sell its stock again, but DeLucae said he expects it will be “a fairly short-term process.”
He also said that Crossways hopes to have a new stock issued sometime next year.
“This is a pretty difficult thing to sell,” DeLucaa said. For more: http://www.barrons.com/articles/2018/08/05/crossroads-trading-co-upsizes-share-and-options-on-sharemarket-to-go-public-trades-under-sparks-in-nasdaq-market/