The term "delisting" of securities means removal of securities of a listed company from a stock exchange. As a consequence of delisting, the securities of that company would no longer be traded at that stock exchange. Delisting can be of two types- Voluntary Delisting and Compulsory Delisting. In voluntary delisting, a company decides on its own to remove its securities from a stock exchange whereas in compulsory delisting, the securities of a company are removed from a stock exchange as a penal measure for not making submissions/complying with various requirements set out in the Listing agreement within the time frames prescribed. Typically, companies that are suspended from trading for not filing quarterly results or other disclosures are asked to delist by exchanges.
The recognised stock exchange (s) shall give the public notice for the compulsory delisting of the company in one English, one Hindi national daily and one Regional language newspaper where the concerned stock exchange is located. The recognised stock exchange(s) shall appoint the independent valuer(s) who shall determine the fair value of the delisted equity shares at which the shares may be tendered by the public shareholders. The recognized stock exchange(s) shall intimate other exchange(s) where the company is listed about the delisting order.
As per SEBI Delisting Regulations, 2009 the following consequences of compulsory delisting would apply to the said companies:
A listed company or an aggrieved investor may file an appeal before the Securities Appellate Tribunal against the decision of the recognised stock exchange delisting the securities within fifteen days from the date of the decision of the recognised stock exchange delisting the securities