MEC Shares Drop Following Reverse Split

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Shares of Magna Entertainment Corp. dropped 11.35% on their first day of trading following the company's implementation of a 1-20 reverse stock split.

The stock price, which closed at 37 cents July 21, began July 22 trading at an adjusted price of $7.40. After receiving an opening bid of $10, shares tailed off to $6.56 on a volume of 3,200.

MEC earlier said it implemented the reverse split primarily to avoid potential delisting from the NASDAQ board in August. Shares of the company had traded under $1 since Dec. 28, 2007, and need to trade above that benchmark figure for 10 consecutive days to avoid delisting.

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