The Slater & Gordon Limited (ASX: SGH) share price has dropped 9.4% today to 24 cents at the close, not far off the low of 23 cents set last week.
For the year, shareholders, who have been holding on and waiting for the better times to arrive, have seen a 96.6% fall in the share price as the chart below shows.
Here are 3 reasons why the share price might be falling today:
- News that Arrium Ltd's (ASX: ARI) bankers had rejected a financing deal which would have seen them reportedly receive about 55 cents in the dollar. With $2.4 billion of debt, you could see why the bankers weren't keen. Slater & Gordon has a similar issue with $783 million of debt due in a year's time, and investors might fear that the company will be unable to refinance its debt.
- Fallout from the resignation last week of the law firm's general counsel and company secretary Ms Moana Weir – just two months into the job.
- Shareholders may have finally realised that the company is unlikely to generate strong returns in future – even if it can recover from its current ails, with question marks over its accounting and there must be concerns over management and their acquisition decisions.
