Nasdaq Delisting Could Block iVillage, Women.com Merger
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The complicated merger deal between rival networks iVillage Inc. and Women.com Networks Inc. could be derailed if iVillage's stock is booted from the Nasdaq exchange, the company warned in a filing with the Securities and Exchange Commission (SEC).
The New York-based iVillage said one condition of the merger is that its shares must be listed for trading on the Nasdaq but, having already been warned that the stock faces delisting for not meeting the minimum share price requirements, the company said the deal may be halted.
"If our common stock is delisted prior to completion of the merger, such condition will not be satisfied and the merger may not be completed, which could have a material adverse effect on our business and operations," according to the filing.
However, iVillage spokesman Carl Fisher told atNewYork this morning the company remains optimistic the merger transaction will close before the Nasdaq delisting process is complete.
"We expect the merger to close towards the end of this quarter, long before the deadline for maintaining the minimum Nasdaq requirement," Fisher said.
iVillage has until July 19 to bump its share price above the $1.00 mark for ten consecutive days but Fisher said the company's shareholders are scheduled to meet in early June to vote on the deal.
"There's always the possibility of postponement and other problems popping up but we don't anticipate this deal will be blocked," Fisher said.
Separately, iVillage said it has amended its deal with departing founder/chief executive Candice Carpenter, a move that will cost the company a one-time lump sum cash payment of $1.3 million.
The amended agreement was necessary when Carpenter stepped down from her role as the chairperson of iVillage's board of directors. "The amendment also provided that Ms. Carpenter would surrender 333,334 iVillage stock options with an exercise price of $24.00 and 75,000 iVillage stock options with an exercise price of $17.17 to us."
Fisher said Carpenter remains a non-executive advisor. iVillage's obligation to pay a salary to Carpenter terminates on December 31, 2002.