Dallas, Texas 02/03/2014 (FINANCIALSTRENDS) – The one million market capped micro mini company Tandy Brands Accessories, Inc. (NASDAQ:TBAC) saw its meagre valuation further hit rock bottom on 31st January, when the stock lost almost 51.7 percent of its market valuation. At day’s end the stock was trading at $0.14, which was 91 percent down from its 52 week high price valuation of $1.59 per share.
The sell off occurred when Tandy Brands Accessories, Inc. (NASDAQ:TBAC) disclosed to Securities and Exchange Commission that it had received formal notification of “disposition of collateral” on 29th January from Salus Capital Partners, LLC. Salus in its role as “lender, administrative agent and collateral agent” for the $29 million loan taken out by struggling Tandy Brands Accessories, Inc. (NASDAQ:TBAC) had disclosed that “due to one or more events of default under the Credit Agreement, it was notifying the disposition of collateral”.
On 29th January, the board of directors of Tandy Brands Accessories, Inc. (NASDAQ:TBAC) have come to conclusion to provide their full consent to the disposition of collateral by Salus.
Explaining the rationale behind the decision not to block the move by Salus, Tandy Brands Accessories, Inc. (NASDAQ:TBAC) executives have explained that, “ financial and operating losses accumulated since 2008, follow up loan defaults, lack of elbow room for executing strategic transaction, lack of support from lenders to “structure a transaction and/or debtor-in-possession financing” are some of the key reasons why they have decided to give their go ahead for this fire sale by the creditor.
When this news became public last week, the investors stampeded to get out of the stock and hence the blood bath, in which the market valuation of the stock almost melted by 50 percent in one day of trading. The firm has accumulated loss of $18 million and total sales of 108 million in the trailing 12 months.