Wheels up signage displayed at the NYSE on July 14, 2021, the company's first day of public trading.
The Wheels Up Experience’s Board of Directors approved a 1-for-10 reverse stock split to increase the trading price of its common stock and avoid delisting by the New York Stock Exchange (NYSE).
With its stock trading below $1 per share since early March, the company faced possible delisting by the NYSE. On June 1, the stock closed at 27 cents per share.
In the reverse stock split, every 10 shares of common stock issues will be automatically combined and reclassified into one share of common stock. The total number of shares authorized for issuance will also be reduced by a corresponding ratio, going from 2.5 billion shares to 250 million shares, Wheels Up said in a news release.
The change is effective following the close of trading on the NYSE on June 7. The stock will begin trading on the adjusted basis beginning on June 8.
“The reverse split is one piece of our ongoing efforts to support Wheels Up’s financial and business strategy,” the company said in a statement. “We’ve also announced broad program changes to improve our profitability profile and member experience, as well as a continued focus on corporate cost management. We believe these moves will help us on our path to profitability and the overall trajectory of our business going forward.”
On April 1, the Wheels Up board recommended that stockholders approve the measure at its annual meeting on May 31 with board discretion.
Increasing the trading price will improve the marketability and liquidity of its stock, the board said in a filing with the Securities & Exchange Commission in April. It also will encourage institutional and retail interest and trading in the stock.
Wheels Up, founded 10 years ago, has seen its stock price drop as losses mount. In 2021, it had traded at a high of more than $10.
