Stock Update (NASDAQ:DRYS): Here’s Why DryShips Inc. Shares Tumbling 28%
DryShips Inc. (NASDAQ:DRYS) shares tumbled nearly 28% after underwhelming investors with the news that the company’s Board of Directors has determined to effect a 1-for-8 reverse stock split of the Company’s common shares. At the Company’s annual general meeting of shareholders on October 26, 2016, the Company’s shareholders approved the reverse stock split and granted the Board, or a duly constituted committee thereof, the authority to determine the exact split ratio and proceed with the reverse stock split.
The reverse stock split will take effect, and the Company’s common stock will begin trading on a split-adjusted basis on the Nasdaq Capital Market, as of the opening of trading on January 23, 2017 under the existing trading symbol “DRYS”. The new CUSIP number for the common stock following the reverse stock split is Y2109Q408.
When the reverse stock split becomes effective, every 8 shares of the Company’s issued common stock will be automatically combined into one issued share of common stock. As of the date of this press release, the Company had 69,357,841 common shares issued. Effecting the reverse stock split will reduce the number of issued common shares from 69,357,841 shares to approximately 8.7 million shares.
No fractional shares will be issued in connection with the reverse split of the issued common stock. Shareholders who would otherwise hold a fractional share of the Company’s common stock will receive a cash payment in lieu thereof at a price equal to that fraction to which the shareholder would otherwise be entitled multiplied by the closing price of the Company’s common stock on the Nasdaq Capital Market on January 20, 2017.
DryShips, Inc. engages in ocean transportation services for drybulk and petroleum cargoes. The company operates its business through three segments: Drybulk and Offshore support. The Drybulk segment provides drybulk commodities transportation services for the steel, electric utility, construction and agri-food industries, which consists transportation and handling of Drybulk cargoes through ownership and trading of vessels. The Offshore Support segment consists of offshore support services to the global offshore energy industry through the operation of a diversified fleet of offshore support vessels.