Question

What happened if the company want to quit from stock market? What happened to investors who...

What happened if the company want to quit from stock market? What happened to investors who bought/shorted that company?

Homework Answers

Answer #1

Companies delist when they want to expand or restructure or the promoters wants to raise their stake or when they are acquired by others. It 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.

To delist voluntarily, a company normally offers shareholders a premium to the price at which the shares are being traded on the exchange. When an investor sells to a promoter wishing to delist, the transaction is not done through exchange.

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