Delisting is the elimination of listing of shares on the Stock Exchange. After delisting, shares cannot be traded on the Stock Exchange. The status of a company that has been delisted usually remains a public company but its shares are not listed on the Stock Exchange. Companies whose shares have been delisted, no longer have obligations as listed companies. Nevertheless, the company is allowed to re-register its shares on the Stock Exchange in accordance with the applicable provisions (relisting). Relisting can be done six months after effective delisting. If it happens to you, don’t let it brings you down, so we recommend you to read more stock news to find more opportunities instead.
What are the types of delisting and their causes?
There are two types of delisting, namely:
1. Voluntary Delisting (Voluntary Delisting) is the issuer itself submitting a delisting due to certain reasons. For example, because of the will of the new controller, due to a merger, or other reasons. Voluntary delisting is usually seen positively. Shareholders need not worry, because there is an obligation to absorb shares in the public at a reasonable price.
2. Forced Delisting, which is delisting carried out by the Securities Exchange authority based on the applicable rules. For example, because shares have been suspended for two years in a row because they have not submitted financial reports, the company’s business continuity has been questioned and there is no explanation and other reasons. Usually, companies whose shares are forcibly delisted are problem companies.
What should an investor do with force delisting?
There are two things that investors can do whose shares are affected by force delisting:
1. Investors can sell these shares in the negotiating market. The Stock Exchange will open a suspension of shares that will be delisted within a certain time, usually several days. But the suspension was only opened in the negotiating market. Within this timeframe, investors are advised to sell these shares. Unfortunately, the shares that will be delisted are usually problematic companies. It’s almost impossible to be sold
2. Investors can leave their shares. Delisting companies usually remain public companies and can be relisted again even though there is little possibility of relisting again. Investor-owned shares still exist. Only companies that are forcibly delisted are problematic companies, the possibility maybe that ultimately the development of the company is no longer clear.