Axion Power International, Inc. (NASDAQ:AXPW) is facing a lot of problems and is thought to be losing its NASDAQ listing. The company has revealed that it is considering a reverse stock split to make sure it keeps moving. The investors were updated by Board Chairman, Donald F. Farley, who stated that the stock is below 3 cents a share. He also stated that the result is due to a shortfall in funding and the company’s transition to a new business model. The warning also hinted that the company might not make it past the 3Q2015.
Axion had conducted its public offering last year, but due to the stock falling so low, the company seems to be incapable of covering equity obligations for them. Mr. Farley had also revealed that the company was considering two options, either to increase authorized shares or go for a reverse split. He also outlined that in the best interest of the shareholders, the second option seems to be the more viable one. If the company goes ahead with this option, it would be the second reverse split in less than a year, by Axion.
Initially, the company had been known for manufacturing batteries with a negative electrode made of carbon, instead of lead. This had enabled the batteries to provide more power over a longer period of time. Unfortunately, recent financial declines have caused the company to change this business model and manufacture carbon electrodes for other battery manufacturers.
Mr. Farley, in his letter, has also made public that his company is also looking for collaborations, with strategic third party companies. This is to target better commercialization and funding options for the company. Another big problem for Axion is that it has been functioning without a CEO, since January 2015. The ex-CEO David DiGiacinto, died unexpectedly.
Axion Power International, Inc. (NASDAQ:AXPW) closed at $0.0376 after losing 6.93% on April 23. The company has 70.55 million shares being traded in the market, with a 52-week range of $0.03-$9.45.