Nasdaq halted trading on competitive local exchange carrier Quentra Networks, Inc., Friday morning, hours after officials announced it had filed for Chapter 11 bankruptcy protection.
It’s a case of bad news following bad, with Nasdaq announcing the halt as the competitive local exchange carrier looks for an avenue of financial safety.
Officials said it would continue normal business operations for its customers.
The federal filing comes at the advice of the company’s new boss, a consultant brought in last week to salvage what he could of the troubled Los Angeles CLEC.
Bruce Ballenger, Quentra’s new chief executive officer, said the company plans to restructure and continue forward with its core business offerings.
“We have taken this step as part of an on-going effort to restructure and ultimately strengthen the company’s financial condition,” Ballenger said. Our goal is the rapid development and execution of plans that will deliver value to our shareholders. We believe we will be able to reorganize Quentra to provide maximum value to our creditors and shareholders as well as to be a profitable and successful company.”
Ballenger didn’t have much time to make the changes necessary to save Quentra . The company closed yesterday at a 52-week low of about 21 cents a share, and has been valued under $1 per share since mid-November. Nasdaq delists companies that post shares under $1 for 30 consecutive days.
Quentra officials have seven days to request a hearing before a panel of independent businesspeople empowered by Nasdaq to make a determination on its fate. Failure to request such a hearing results in automatic delisting.
Earlier this month, Ballenger made sweeping staff cuts, mainly in its international telecommunications and retail division, and bandied about the divestiture of several of Quentra’s business offerings.
Quentra offers customers U.S. and international long-distance calling services, bundled with Internet applications, over a touch-screen telephone system, not a PC. Officials had recently announced the completion of final field testing and were getting ready to market its product.