Sonder in Danger of Being Delisted From Nasdaq
Short-term lodging company second real estate firm this month to receive a delisting notice
By Nicholas Rizzi April 26, 2023 11:33 am
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Sonder could lose its place on the Nasdaq stock exchange.
The short-term lodging company received a notice this week from Nasdaq that it was in danger of being delisted since its shares have been trading at below $1 for 30 days in a row. The news was first reported by the travel website Skift.
Sonder’s stock started the year at $1.27 a share — a huge drop from the nearly $9 it debuted at in 2022 — and started creeping below $1 in February. Its shares were trading at 41 cents as of Wednesday morning.
A spokesperson for Sonder did not immediately respond to a request for comment.
The San Francisco-based lodging company has to get its stock to close for at least $1 for a “minimum of 10 consecutive business days” during its 180-day grace period, which ends on Oct. 18, according to a Securities and Exchange Commission filing.
It can also try to transfer to the Nasdaq Capital Market exchange instead, which will give it more time to get its stock at $1 a share, according to the SEC filing.
Sonder first announced its intention to go public by merging with a special purpose acquisition company (SPAC) — a blank-check firm designed to take companies public while avoiding an arduous initial public offering process (IPO) — in 2021 at a $2.2 billion valuation.
The process was delayed, but Sonder finally went public in January 2022, debuting at $8.95 per share and a $1.9 billion valuation, Skift reported. Its stock price has been falling since, and in June 2022 Sounder announced it would lay off 21 percent of its corporate employees and 7 percent of its frontline workers as it tried to restructure its operations.
Sonder was part of a wave of real estate and proptech companies that went public through the SPAC process, many of whom have struggled since. Keyless entry maker Latch saw its share price parachute 93 percent from its debut — currently trading at 75 cents per share — and implemented layoffs.
Coworking giant WeWork — which went public via a SPAC merger in October 2021 after its very public IPO failure — received a notice last week from the New York Stock Exchange that it was in danger of being delisted since its stock price dropped below $1 per share for more than a month. Its shares are currently at 44 cents.
Nicholas Rizzi can be reached at nrizzi@commercialobserver.com.
