American Virtual Cloud Technologies (NASDAQ:AVCT) stock is taking a beating on Thursday as the company files for bankruptcy.
According to a filing with the U.S. Securities and Exchange Commission (SEC), American Virtual Cloud Technologies and two of its subsidiaries, AVCtechnologies USA and Kandy Communications, have voluntarily filed for bankruptcy.
Northland Capital Markets and SOLIC Capital Advisors are advising American Virtual Cloud Technologies throughout this process. The company has also filed first-day motions that would allow it to continue normal business operations during the bankruptcy period.
What This Means for AVCT Stock
American Virtual Cloud Technologies has yet to decide what it will do with the business. The company says it’s considering strategic alternatives, which could include a sale of its assets. No matter the case, the filing doesn’t bode well for AVCT stock.
As of this writing, traders are reacting negatively with heavy trading pulling shares lower. Some 3.2 million shares of the stock have already changed hands as of this writing. That’s quickly approaching the company’s daily average trading volume of 3.9 million shares.
Investors will note that AVCT was expanding throughout 2020 and has more than 30 customers. That includes several big players in the tech space, such as Microsoft (NASDAQ:MSFT), IBM (NYSE:IBM), and AT&T (NYSE:T).
AVCT stock is down 18.7% as of Thursday morning.
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On the date of publication, William White did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.