Sientra announces reverse stock split to boost shares
Sientra, a medical aesthetics company focused on breast augmentation, announced on Jan. 20 that its board of directors approved a 1-for-10 reverse stock split of the company’s issued and outstanding common stock.
The reverse stock split was effective as of 1 p.m. on Jan. 19 while the company’s common stock began trading on the Nasdaq Global Market on a split-adjusted basis on Jan. 23.
Stockholders approved of the reverse stock split on Jan. 12, at a ratio ranging from 1-for-5 up to 1-for-15 before ultimately deciding on 1-for-10.
A reverse stock split, in this case, means for shareholders that owned 10 previous shares of Sientra now own 1 share of new Sientra stock.
The purpose of this is to decrease the total number of shares of common stock outstanding and increase the market price of the common stock in order to meet the listing requirements of The Nasdaq.
Shares of Sientra were trading under 30 cents since October and shares closed at around 21 cents on Jan. 19.
The next day, because of the reverse stock split, shares opened at $2.10. As of Jan. 24, shares closed at $1.77.
No fractional shares were issued because of the reverse stock split and stockholders who would otherwise be entitled to receive fractional shares will instead receive a cash payment at a price equal to that amount.
Sientra was founded in Santa Barbara in 2003, but the company appears to have moved its headquarters to Irvine to start the new year. It has not closed its Goleta offices as of Jan. 24.
Sientra did not respond to request for comment on the moving of headquarters.