delist


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Delisting

The removal of a stock from trading on an exchange. Delisting occurs when a publicly-traded company violates the exchange's rules, or, more commonly, when the company ceases to meet listing requirements. For example, when a company's market capitalization falls below a certain level, it is in danger of delisting.

delist

To drop a security from trading on an organized exchange. Delisting may occur for a number of reasons including failure to meet an exchange's standards or placement of a new listing on another exchange. Compare list.
Case Study In early 2001, Nasdaq informed Drkoop.com, a one-time high-flying Internet company, that the firm's stock was subject to being delisted from the Nasdaq Stock Market. At the time of the notice Drkoop.com stock was trading at approximately 20¢ per share, well below the $1 per share required to continue trading on the Nasdaq. Delisting can have a serious negative impact on a firm's ability to raise equity capital, since it is likely to reduce liquidity and increase the bid-ask spread quoted by dealers. Many individual investors avoid buying a delisted stock as trading volume dries up. Negatives associated with delisting are likely to cause a major decline in the market price of a stock that most likely has already experienced a major price decline. Nasdaq, which delisted 240 companies in 2000, often begins the delisting process when a stock's bid price falls below $1 per share for 30 consecutive trading days. The firm subsequently has 90 calendar days to boost its stock price above $1 per share for 10 consecutive trading days. The New York Stock Exchange has a similar price requirement plus additional minimums regarding market capitalization and shareholder equity.
References in periodicals archive ?
'Companies will delist for different reasons from voluntary to regulatory delisting, mergers and acquisitions and other things that would cause them to delist.
However, a company's decision to delist does not happen immediately.
"The biggest challenge would be to track the vanishing companies and their promoters and how to force them to acquire the shares (delist) when in reality they never intend to do it.
A total of 208.93-million shares will be delisted from Cairo bourse, according to a statement issued by the firm.
In 2013, the Presque Isle Bay Area of Concern (Lake Erie, Pa.) was delisted, the first since GLRI was launched in 2010.
After its shares have been delisted from the NYSE, Pulse Electronics expects that its shares may be quoted on the OTC Markets Inc.
The reasons why companies might delist from a major stock exchange are controversial, as is whether delisting sends a positive, neutral, or negative signal to markets and investors.
A company is licensed for operation in the stock market by the Capital Market Authority (CMA) according to these rules and if the company fails to adhere to a single rule, it will be delisted, El-Sherif explained.
The high-technology powerhouse also said it will soon apply to delist its shares from the Fukuoka Stock Exchange and the Sapporo Securities Exchange, also due to low trading volumes.
(5) Verrier M, Gibson B, Landry MD.Ontario's decision to delist publicly funded community based physial therapy services.
The company said in a statement that it had notified Nasdaq Dubai in writing of its intention to voluntarily delist its securities from the Official List of the exchange effective from the close of trading on July 18, 2011.
Aabar Investments, Abu Dhabi sovereign wealth fund and top investor in German carmaker Daimler, is set to buy out its minority shareholders at Sunday's closing price of 1.45 dirhams a share and delist from the stock market.