Stock market today: S&P 500 hits fresh record close on stronger economic growth
In a recent move, Altisource Portfolio Solutions S.A. (NASDAQ:ASPS), currently trading at $0.72 per share, announced significant changes to its corporate structure and share capital. The company, which has seen its stock decline over 74% in the past year according to InvestingPro data, held an extraordinary general meeting on Monday, February 18, 2025, where shareholders approved amendments to the company’s articles of association.
The first amendment involved a reduction in the par value of Altisource’s common stock from $1.00 per share to $0.01 per share. This adjustment decreased the company’s share capital by approximately $30.5 million, reallocating the reduced amount to the share premium account. With a current market capitalization of just $19.58 million and a concerning current ratio of 0.19, this change effectively reduces the nominal value of existing shares without canceling any common stock.
In addition, the board of directors received renewed authorization to increase the number of shares they can issue from 100 million to 250 million. This expansion grants the board the power to issue common stock, warrants, options, or other similar instruments within the authorized share capital of up to $2.5 million. The board can also limit or cancel preferential subscription rights of shareholders when issuing new shares, a measure that could potentially dilute current stockholder value.
The board’s authority to issue new shares and related instruments is set for a term of five years, providing the company with increased flexibility for future capital raising activities or other corporate transactions.
The detailed amendments, now part of the company’s official articles of incorporation, were filed with the U.S. Securities and Exchange Commission on February 24, 2025, and are accessible in the full text of the Amended Articles as Exhibit 3.1 in the current report.
These strategic changes by Altisource come as part of their ongoing efforts to adjust their corporate strategy and financial structure. While InvestingPro analysis shows management has been aggressively buying back shares, the company’s overall financial health score remains weak. Shareholders and potential investors may view these amendments as a preparatory step for future growth initiatives or other corporate activities that could reshape the company’s market position. For deeper insights into Altisource’s financial health and growth prospects, including 12 additional ProTips and comprehensive valuation metrics, check out the full Pro Research Report on InvestingPro.
This report is based on statements from a press release and the information filed with the SEC.
In other recent news, Altisource Portfolio Solutions S.A. has undergone significant financial restructuring. S&P Global Ratings downgraded Altisource’s credit rating to ’SD’ following a distressed debt exchange, which reduced the principal balance of its senior debt by approximately $60 million and extended the loan’s maturity to April 2030. Despite the lenders receiving common shares amounting to 63.5% of the pro forma outstanding shares, S&P Global Ratings considered the exchange distressed, as the debtholders received less value than initially promised. The agency noted the exchange improved Altisource’s liquidity and interest coverage, although liquidity remains limited with $28 million in cash as of September 30, 2024.
Additionally, Altisource announced changes to its executive compensation structure. Effective February 1, 2025, Chairman and CEO William B. Shepro and CFO Michelle D. Esterman will revert to receiving their full base salaries in cash, ending the previous arrangement of partial compensation in company stock. The company also approved new Management RSUs for certain executives, contingent upon the completion of pending transactions to restructure term loans. These RSUs, representing up to 5% of the company’s post-transaction common stock, are designed to incentivize management performance. The executives will not participate in the Long-Term Incentive Plans for 2025 to 2027 due to the issuance of these RSUs.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.