How to Plan Delisting?

Q: Delisting means permanent removal of securities of a listed company from all or any of the recognised stock exchanges where such shares are listed. As a consequence of delisting, the securities of that company would no longer be tradable at that stock exchange.

rsjlexsys, Delhi

29th June 2016

Legal in Jangpura, Delhi

equity

stock market

equity market

Follow Discussion

Also see discussions for

Delhi Jangpura Legal Legal in Delhi Legal in Jangpura

Replies (3)

thanks for sharing.

liyans, Kolkata

9th July 2016

Comment

Hi Richa!!
Thanks for the information. But i want to kn ow that what are the rules behind the delisting of a stock?

Rakshit, Mumbai

30th June 2016

Comment

Good question Richa!!
When a security is found to be not in compliance the exchange issues then company gets a notification of non-compliance from SEBI, but the stock is not immediately taken off the stock exchange. This letter gives the company the opportunity to respond with a description of the actions they are taking, or plan to take, to become compliant with continued listing standards. If the company doesn't respond with their plan of action within 10 business days of the receipt of the letter to the SEBI, the exchange would proceed with the delisting.

Rahul Kumar, Delhi

30th June 2016

I agree with Rahul.... It can be done either on voluntary decision of the company or forcibly done by SEBI on account of some wrong doing by the company. There are certain norms which a company needs to follow while listing on the stock exchange. In case the company fails to do so, then SEBI takes the action which generally leads to delisting of the company from the stock exchange.

Richa, Delhi

30th June 2016

But Public Shareholders to be given an exit option if the company or its promoters propose to delist its securities from all the stock exchanges on which they were listed. Over and above, no exit opportunity was required to be given in case the company continues to remain listed at stock exchanges having Nationwide trading terminals.

Rahul Kumar, Delhi

30th June 2016

Yes, and a companies generally delist when they want to expand or restructure, are acquired by others, or the promoters wants to raise their stake. Delisting can be a voluntary decision where a company pays investors and removes its securities from the exchange or a forced delisting by stock exchanges for non-compliance with their rules.

Richa, Delhi

30th June 2016

Comment