🔒Norwalk ginger beer maker Reed’s plans reverse stock split to pursue exchange listing

Reed’s Inc., the Norwalk-based maker of ginger beer and other soft drinks, plans a reverse stock split aimed at boosting its share price and positioning the company for a potential national-exchange listing, according to a new filing with the U.S. Securities and Exchange Commission. In an Oct. 9 SEC filing, the beverage company said its board of directors and majority shareholder have approved a reverse split at a ratio ranging from 1-for-3 to 1-for-9. The final ratio and effective date will be determined by the board. The move would consolidate Reed’s outstanding common stock, reducing the number of shares held by investors while proportionally increasing the price per share. Reed’s said the action is intended to raise its stock price, improve trading liquidity and help the company meet minimum bid requirements for continued or future listing on a national exchange. The company’s shares currently trade over the counter under the ticker symbol “REED.” In its filing, Reed’s said it hopes the higher share price will help it qualify for a potential listing on the NYSE American exchange, which requires a minimum bid price of at least $3 per share, or another national exchange. The company said listing on a national exchange could broaden its investor base and improve access to institutional capital. Because the company’s majority stockholder, D&D Source of Life Holding Ltd., holds more than 50% of the voting shares, the proposal did not require a shareholder meeting or proxy solicitation, the company said. The approval was granted by written consent, in accordance with Delaware corporate law. Reed’s cautioned there is no guarantee the reverse split will lead to a sustained increase in its share price. The move comes as new CEO Cyril Wallace, a former PepsiCo Beverages North America executive, works to stabilize the 21-employee company following years of financial losses. Since taking the helm in May, Wallace has focused on tightening supply-chain operations, improving cash use and raising Reed’s market profile in the competitive soft drink sector. Founded in 1987, Reed’s manufactures and markets a line of natural soft drinks, including its flagship ginger beer, Virgil’s sodas and other craft beverages.