The Exchange To Delist 17 Companies

delist

The Exchange has just announced that it will be delisting about 17 companies who are currently been traded on The Exchange.

According to people with the knowledge of the matter, The Exchange has just notified affected companies of the bourse’s decision to remove them from the list quoted companies that can be freely traded on the flow of The Exchange. While the process is not yet completed, the announcement of an intention to delist marks the beginning of the process and announcements will be made in trickles as the delisting is being concluded on a case by case basis.

In case you are wondering why a company should be booted out of the stock exchange? See The Exchange rules:

“The Exchange will delist securities where the Issuer has not complied with the Listings Rules of The Exchange, or for breach of the terms and conditions of the General Undertaking executed by the Issuer when its securities were listed by The Exchange; or further to the Issuer’s application for voluntary delisting of its securities. Other reasons include where, the National Council of The Exchange (“Council”) considers that there is insufficient public interest in the Issuer, or the securities of the Issuer in the hands of the public are insufficient to make a market in the securities.”

The Exchange would begin a process that will finally determine which of the companies is eventually removed from the bourse. Based on the rules of The Exchange above, there are two types of delisting. Voluntary and regulatory (non-compliance with set out rules) delisting.

Any company will qualify for voluntary delisting if:

The Listings Regulation Department of The Exchange submits a recommendation to the Management of The Exchange for delisting of the securities of the non-compliant Issuer, with sufficient reasons to serve as a basis for the proposed action.

b. Management obtains the approval of Council and, thereafter, the affected Issuer is served with a delisting notice in addition to publication of same in daily newspapers with national coverage.

c. The delisting notice gives the affected Issuer three (3) months to regularize its listing status and comply with all applicable listing requirements and obligations, failing which its name will be removed from the Daily Official List of The Exchange.

While a company would be delisted  for regulatory reasons if:

“Council reserves the right to remove the name of a company from the Official List of The Exchange at its absolute discretion and may, if:

a) it considers there is insufficient public interest in the company, viz, insufficient shares in the hands of the public; or b) any of the foregoing terms and conditions are not complied with; or

c) the company becomes a subsidiary of any other company.”

All companies quoted on the exchange know the rules and should comply. The Exchange has not offered an official statement but would have notified the companies involved.

Investors and shareholders in any quoted company must find out if companies that they have holdings in are amongst them.

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