Brief: Alliance Gaming plans reverse split

Alliance common was quoted at $1.8125 in early afternoon trading today, below the $5 minimum Nasdaq requires for continued listing. Alliance has traded as low as $1.625 in the past year.

After the split is effected, Alliance will have 9.8 million common shares outstanding. Strike prices for warrants and options will be proportionately adjusted, the company said.

The Las Vegas-based gaming equipment supplier said the reverse split also should enhance the ability of institutional investors to own the stock and facilitate margin purchases for retail investors.

Many institutions have self-imposed restrictions on buying stocks trading below $5. Retail brokers are generally prohibited from allowing individual investors from buying low-priced stock on margin, i.e., for a percentage of the quoted price, because such transactions involve loans for the balance secured by underlying stock.

Alliance also said its Bally Gaming & Systems division has signed contracts or letters of intent valued at $10.7 million to install a monitoring system on more than 10,000 gaming machines at seven casinos.

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