Delta Airlines is going out of bankruptcy next month. Its going to "relist". Please help! Do I sell the stock now?
2007-03-27 13:49:31 · 6 answers · asked by Anonymous in Business & Finance ➔ Investing
Your stock is going to be worthless unfortunately. So if you can get anything for your old stock, you should definitely do so. "Old" Delta stockholders will be wiped out under the Chapter 11 plan.
Here's the word from Delta's own website.
What will happen to Delta's common stock during the Chapter 11 process? What value will it have in the future?
Trading in Delta's common stock was suspended by the New York Stock Exchange shortly after Delta's Chapter 11 filing in 2005. The stock was delisted shortly thereafter and now trades in the "over-the-counter" market on the "Pink Sheets" (www.pinksheets.com). The new trading symbol for Delta's common stock is OTC: DALRQ. Under the proposed plan of reorganization, current holders of Delta common stock would receive no distribution, and the securities would be canceled upon the effective date of the plan. Delta has indicated for some time that the company expected its common stock would not have any value under any plan of reorganization the company might propose, which is not uncommon in Chapter 11 proceedings.
2007-03-28 02:02:20 · answer #1 · answered by DLeibowitz 5 · 1⤊ 0⤋
When a company goes bankrupt, typically they either go into receivership or they restructure themselves. If they go into receivership, the company basically sold for scrap. This means all the assets are sold and whatever cash is left over is divied up amongst the creditors.
When a company restructures, they typically strike deals with their creditors to allow them to continue to operate. Typically the creditors are given some form of ownership of the company in some fashion as part of the deal. This means that whoever holds the debt on the company, becomes some form of owner. The old stock is canceled and new shares are issues.
It is important to note that shareholders are owners of the company. They are not creditors.
If you start a lemonade stand with a loan from the bank and fail to pay your debts back, the bank will take your lemonade stand from you, and either sell it and try to recoup as much of their losses as possible or run it better than you did so it is more attractive to a buyer. Ultimately, you lose the lemonade stand.
Although I have not followed the peril of Delta, it sounds as if the debt holders are ready to sell the restructured company back to the public.
2007-03-27 15:34:39 · answer #2 · answered by jhistenes 2 · 1⤊ 0⤋
The stock you own will be cancled and worthless. New stock will be issued, which you will have to buy alll over again if you want it.. Your money is gone with the old stock. You can write the loss off on your income taxes though.
2007-03-27 14:15:50 · answer #3 · answered by jeff410 7 · 0⤊ 0⤋
You mean the 67 cents Delta ?
http://finance.yahoo.com/q/bc?s=DALRQ.PK&t=2y&l=on&z=m&q=l&c=
It looks like they just moved it to another market because it was below a $1 so long . . .
I think you could have sold it at any time tho .
2007-03-27 14:01:55 · answer #4 · answered by kate 7 · 0⤊ 0⤋
The old stock is probably worthless. Same crap happened with my old WorldCom stock.
2007-03-27 13:56:51 · answer #5 · answered by Bostonian In MO 7 · 0⤊ 0⤋
PANIC!! Run wildly around in all directions. Scream and moan and pound the floor.
2007-03-27 13:54:10 · answer #6 · answered by Yardbird 5 · 0⤊ 0⤋