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Voluntary Delisting: Presented By: Anshika Rastogi Roll No: 46

This document discusses voluntary delisting of companies from stock exchanges. [1] Voluntary delisting occurs when a company chooses to delist its shares from an exchange on its own initiative. [2] Reasons for voluntary delisting include the costs of listing requirements being too high or the promoter's holding increasing above 75%. [3] Benefits for shareholders include often receiving an exit price higher than the market price. The document provides examples of companies that have voluntarily delisted and compares the key differences between voluntary and compulsory delisting processes.

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44 views

Voluntary Delisting: Presented By: Anshika Rastogi Roll No: 46

This document discusses voluntary delisting of companies from stock exchanges. [1] Voluntary delisting occurs when a company chooses to delist its shares from an exchange on its own initiative. [2] Reasons for voluntary delisting include the costs of listing requirements being too high or the promoter's holding increasing above 75%. [3] Benefits for shareholders include often receiving an exit price higher than the market price. The document provides examples of companies that have voluntarily delisted and compares the key differences between voluntary and compulsory delisting processes.

Uploaded by

anshika_rastogi
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PPTX, PDF, TXT or read online on Scribd
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Voluntary Delisting

Presented By:
Anshika Rastogi
Roll No: 46
Listing

STOCK
COMPAN
LISTING EXCHAN
Y
GES

Delisting

STOCK
DELISTIN COMPAN
EXCHAN
G Y
GES
How to delist ??

Delisting

Compulsory Delisting Voluntary delisting


Reasons of Voluntary Delisting

 The burden of meeting listing requirements is too much (audited financials, SEC
filings, & listing fees cost )

 Holding public shareholding less than as prescribed by the SEBI.

 Undervalued, or due to poor financial position and problems on its going concern
status.

 If the promoter holding increases more than 75 per cent, it can go for voluntary
delisting.
Benefits for Company

 The company is acquired or merges with another company.


 Company is hiding the key financials from regulators and competitors.

Benefits for Shareholders

 Fair price/exit price of the stock is higher than market price since the offer price is
usually higher than the market price.

The fair price shall be higher of the following:


 
the average of the weekly high and low of the closing prices of the equity shares of
the company during the twenty six weeks .

OR

two weeks preceding the date on which the recognized stock exchanges were
notified of the board meeting in which the delisting proposal was considered,
Name of the Company Date of Delisting Reason for Delisting

Aqualand (India) Ltd 31-Mar-10 Voluntary Delisting - BSE

Voluntary Delisting - BSE


Cosy Mercantile Limited 12-Apr-10 (Small Company Route)

Micro Inks Ltd 13-Apr-10 Voluntary Delisting - RBBS

Voluntary Delisting through


Sri Krishna Drugs Limited 10-Jun-10 RBBS - DSE

HSBC InvestDirect India Ltd 15-Jul-10 Voluntary Delisting - BSE


Voluntary Delisting from
S. No Criteria Compulsory Delisting
all the Exchange(s)
1. Initiative Action Any Recognized Stock Exchange Any Company can
makes an order to delist the equity voluntarily apply to the
shares of a company. concerned stock
exchange(s) for delisting.
2. Grounds Delisting order can be made on the The Company either for
non-fulfillment of the listing cost benefit, or to comply
regulations of the respective with any of the rules and
exchange and on any other ground regulations etc may seek
prescribed in the rules made under delisting from any of the
section 21A of SCRA, 1956. exchange.
3. Public Notice Public Notice in this case be given Public notice and all
by the Exchange announcements be given
by the Promoters of the
company.
4. General Meeting No need of the General meeting of Shareholders resolution
of the the shareholders to be passed through
shareholders Postal ballot.
5. Appointment of The complete process is The complete process is
Merchant monitored by the Panel of monitored by the Merchant
Banker Experts Bankers

6. Exit Price To be calculated by the The price to be determined on the


Independent valuer at basis of the past trading data or
which the Promoter should book values of the company by the
take the shares from the promoters in consultation by the
Public shareholders. Merchant Banker

7. Reverse Book No bids are invited from the Complete process of Reverse Book
Building process Shareholders for Building is to be completed for
determination of the Final determination of the Final Price.
Price

8. Debarred from The company/ The company can not relist its
the securities Promoters/Directors are securities for a period of 5 years.
market debarred from the
securities market for a
period of 10 years
Bibliography

http://www.delisting.in

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