SAVANNAH, GA (WTOC) - Two weeks after the film company's CEO was ousted in a hostile takeover, shareholders of Medient Studios are questioning the company's future.
Medient stock is currently trading at .0017 cents a share, down more than 99 percent from its high a year ago.
Medient chief financial officer Jake Schapiro took over as CEO after former chief executive Manu Kumaran was ousted by the company's board of directors June 11. In a conference call to investors the next day, Schapiro, promised to stop diluting shares of Medient stock.
He blamed Kumaran for issuing new shares to raise funds to build Medient's proposed $90 million movie studio, slated for 1,550 acres off Interstate 16 owned by the Effingham County Industrial Development Authority.
Since that conference call, the company has issued 200 million new shares. It's not clear, though, whether the new shares were authorized before Schapiro took over.
There now are 2.1 billion Medient shares on the market.
That is a big concern for David O'Hearn, a Savannah resident who invested in the company.
"People like to dream, but eventually, Wall Street puts a price, and a reality check, on things," O'Hearn said."This company's stock has been devalued faster than a third-world currency."
Medient has sent news releases since the takeover touting progress on the movie studio, including completing studio designs and selecting a project engineer. Medient also says it has paid up its bills to vendors, contractors and consultants.
In a conference call to investors immediately after the takeover, Schapiro announced plans to scale-down the planned movie studio. It remains unclear whether the Effingham County Industrial Development Authority will agree to the new plans.
A Medient spokesman declined comment Sunday night on the company's progress, and a call to Schapiro's cell phone was not immediately returned.
Schapiro received 250 shares of preferred stock with his promotion to CEO, giving him more voting power than other shareholders. Schapiro also would be reimbursed first if the company went into bankruptcy.