NEW YORK, NY / ACCESSWIRE / December 19, 2018 / Shares of Blue Apron and Rent-A-Center were both seeing steep losses on Tuesday. While Blue Apron had no news, traders were concerned with the latter company ending its roughly $800 million agreement to be acquired by Vintage Capital Management LLC.
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Blue Apron Holdings, Inc.
Blue Apron Holdings, Inc. shares tumbled on Tuesday, closing the day down 11.17% and hitting under $1.00. The stock hit a brand new 52-week low yesterday and became the third worst IPO in the last ten years. The stock has seen 90 percent of its market value disappear since its IPO last June. There was no news from the company to explain the big drop but hitting under $1.00 for the first time could have some damaging effects. The NYSE doesn't allow shares to trade below $1 which may prompt management to consider a reverse stock split to avoid being delisted from the exchange. It was in November that the company reported third quarter financial results with CEO Brad Dickerson saying on the earnings call, "In the third quarter, we were particularly pleased to outperform on the bottom line with a 61% year-over-year improvement in both net loss and adjusted EBITDA as we continue to exert financial and operational discipline."
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Rent-A-Center, Inc. shares were down 9.83% on Tuesday with more losses seen in after-hours trading after the company said it has ended its roughly $800 million agreement to be acquired by Vintage Capital Management LLC after the investment firm didn’t extend the deal’s deadline. According to Vintage, the termination of the deal was "invalid" and that it plans to pursue "all available remedies" against the company. "Vintage believes that the merger agreement remains in effect and that Rent-A-Center's actions constitute a further material breach of the merger agreement," Vintage said in a statement. Rent-A-Center traded nearly 36 million shares yesterday compared to an average trading volume of just around 856,000 shares. The company also said it will be hosting a 2019 financial forecast call on Thursday, December 20th, at 8:30 a.m. ET.
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SOURCE: The Market Edge