Three months for delisting

Source: ria.ru

The united Russian stock exchange MICEX-RTS informed yesterday that it was planning to get massive delisting (which commenced at the end of December 2011) in order. The bourse will be able to either prohibit delisting of shares or take them to the “sanitary” regime.

Today’s situation with delisting is unacceptable anyway (see: http://gaap-ifrs.com/news/125411). If somebody wants to leave, that company’s request will be subject for consideration by a special financial markets committee which will then give its recommendations on suspension of trading with that company’s securities. If it is suspension, than a special 3-months “sanitary” period will be provided for investors to get rid of securities in possession.

To compare with, until recently a different approach was used by MICEX-RTS, according to which delisting was completely unexpected. This was done on purpose so that securities were not purchased by new investors and remained only in portfolios of already active ones. The decision to change the way it is done became the stock-exchange’s response to numerous angry complaints by investors who accused it in dishonorable behavior: indeed, the bourse decided to inform on delisting of 8 companies (including really large ones) in one hour before closing. Once again, we advise to review our news from 19 January – GAAP-IFRS.COM.

Head of the Federal Financial Markets Service Dmitry Pankin thinks that each delisting decision should be approved separately on general shareholders’ meetings. “In that case, the decision on delisting is expected to launch a mechanism of shares repurchase from shareholders who voted against such decision or didn’t vote at all”, - he explained.