When a company gets delisted, it means its shares are no longer trading on a major stock exchange like the Nigerian Exchange (NGX) or the New York Stock Exchange (NYSE). For many investors, the big question is: “Can this company ever make a comeback and relist?”
The short answer is yes, sometimes but not always. Let’s break it down.
Why Do Companies Get Delisted?
A company can be delisted for two main reasons:
- Voluntary Delisting – The company chooses to leave the stock exchange. For example, a business may want to go private, restructure, or merge with another company.
- Involuntary Delisting – The exchange forces the company out because it no longer meets listing requirements. This could happen if the company:
- Fails to meet the minimum share price
- Doesn’t file financial reports on time
- Goes bankrupt or becomes financially unstable
Can a Delisted Company Relist?
Yes, it’s possible but the road isn’t easy. For a company to relist, it must fix whatever caused the delisting in the first place and then go through the exchange’s approval process again.
For instance, if it was delisted for not meeting financial reporting requirements, it must catch up on filings and show consistent compliance. If its share price dropped too low, it may need to restructure or regain investor confidence before reapplying.
What Are Some Listing Requirements?
Every stock exchange has rules that companies must follow to stay listed. These rules help protect investors and keep the market fair. Some of the common requirements include:
- Minimum Share Price: Exchanges often set a floor price. For example, on the NYSE, a company usually needs to keep its stock above $1 per share. If it stays below for too long, it risks delisting.
- Market Capitalization: Companies must maintain a certain level of overall value (share price × number of shares). Falling below this can trigger warnings.
- Financial Reporting: Firms must submit audited financial statements regularly. Skipping reports or submitting inaccurate ones can lead to suspension.
- Corporate Governance Standards: Companies must have independent board members, annual general meetings, and strong internal controls.
- Public Float: A certain percentage of shares must be available for the public to trade—not just owned by insiders.
Failing to meet these standards can get a company suspended first, and if problems persist, it can be delisted.
What Happens If It Doesn’t Relist?
Not every delisted company comes back. If it doesn’t relist, investors can still sometimes trade its shares over-the-counter (OTC), but liquidity is much lower and risks are higher. In some cases, especially with bankruptcies, investors may lose their entire investment.
Conclusion
So, will a delisted company relist on the stock market? It depends on the company’s ability to recover, restructure, and meet exchange rules again.
As an investor, it’s smart to track company news and financials closely. If you’re on Trove, focus on companies that meet strong listing standards today—that’s a safer way to grow your wealth than betting on a comeback that may never happen.
