We reported back in May that the IFL’s big plan to survive another year was to double the number of stocks avaialable. Today we’re here to tell you that this plan has gone through and it will take at least a while longer before the IFL ship sinks:
Shareholders gave the company authorization at its annual meeting late last week to issue an additional 75 million shares of common stock. Rarely do companies sell the entire allotment of stock at one time following shareholder approval, but it’s imperative that the IFL issue a portion of its authorized stock by the end of 2007. The company previously stated that it does not have adequate funds to make it to year’s end. With approximately 21 million shares of original stock still un-issued, the company now has a total of 96 million shares at its disposal.
While issuing additional stock – especially at the current price of IFL’s stock – has the effect of diluting the value of stock previously purchased by shareholders, the move is all but a necessity for the league, which has been bleeding red ink since its inception in late 2005.
In my opinion, this is nothing but a band aid. If the IFL can deal with it’s real issues (the Team concept needs revamping, they need to learn how to promote live shows) then perhaps they’ll make it to this time next year. But considering everyone in charge seems more interested in making deals with popcorn and trading card companies, I don’t think these issues will be addressed.