Moxian Stock Down 15% After 1-for-5 Reverse Stock Split
Moxian Inc. (Nasdaq: MOXC), an online-to-offline company connecting brick-and-mortar businesses with smartphone users via its mobile app, saw its stock decline over 15 percent today after it announced that its one-for-five reverse stock split became effective.
This reverse stock split had been approved by the Shenzhen-based firm's Board of Directors on April 3.
Prior to this, Moxian had faced a potential delisting of its stock from the Nasdaq Stock Exchange because of its low share price; companies listed on the Nasdaq must trade at a minimum price of $1 a share.
Moxian was founded in 2013 by James Mengdong Tan, a Singaporean entrepreneur, and went public on the Nasdaq in 2016.
The Business Times, a Singaporean newspaper, detailed Tan's vision in 2015:
"Simply put, think Uber but not just for the taxi business; it could cover a wide range of services such as car wash or repair, hair dressing, handymen, cleaners, grocery stores, bars, restaurants and the list goes on."
However, Tan resigned from all his positions in September 2017. Moxian took out a loan from Shu Juan Liu, a company director, in November 2017, and Liu appointed Ethan Yin as chief executive officer in February 2018. Yin resigned in November 2018.
As of Dec. 31, 2018, Moxian had $303,962 in current assets but faced current liabilities of $10.7 million.
"As of the date of this report, the Company has essentially ceased operations and is looking for financing options," the company reported. "The Company does not envisage a significant improvement in financial condition and is exploring various strategic options which may involve issuing more securities to public or private investors."
However, Moxian announced it was borrowing 6.77 million yuan ($1 million) from Junsheng Tan in January. Moxian stock closed at $2.43, down 45 cents.
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