The decision to use all reserve funds to buy back 600,000 treasury stocks may leave Yeah1 (code: YEG) skint of profit.
|Yeah1 has just registered to buy back 600,000 treasury stocks |
As the price of the YEG stock has just lost 35 per cent of its value after restrictions from YouTube, Yeah1 has decided to sell its one-month multi-channel network ScaleLab as well as registered to buy back 600,000 treasury stocks to calm down shareholders.
According to the State Securities Commission of Vietnam (SSC), Yeah1 will buy back the stocks at the market price at the time of transaction. Previously, chairman Nguyen Anh Nhuong Tong and deputy general financial director Vo Thai Phong also registered to buy 150,000 YEG stocks.
Their move took place after Yeah1 was hugely impacted by YouTube’s announcement to stop working with all of Yeah1 Group JSC’s (YGC) subsidiaries related to Google Adsense like Yeah1 Network, ScaleLab, and SpringMe after March 31.
The global leading video platform’s decision has pulled down the YEG price from VND245,000 ($10.6) to VND158,700 ($6.9) as of the afternoon of March 11.
The representative of Yeah1 stated that the firm is in discussions with YouTube’s leaders with the hope of maintaining the content hosting agreement (CHSA) between the two sides after March 31.
However, an expert stated that once Yeah1 loses its CHSA with YouTube, its subsidiaries Yeah1 Network, ScaleLab, and Springme will no longer be a part of YouTube’s multi-channel network and be managed by the company. Thus, Yeah1 will lose all revenue from YouTube, which accounted for 28 per cent of its revenue in 2018.
Yeah1 has nearly 31.28 million shares on HoSE. The company shares hit the daily declining limit of 7 per cent in all five trading sessions of last week, to plummet a total of 30.4 per cent, ending at VND170,600 ($7.4) per share on March 8.
After last week, Yeah1 has lost nearly VND2.33 trillion ($101.3 million) from its market value.