Skip to content

CS Executive · Capital Market and Securities Laws · Delisting of Equity Shares

Rohan Foods Ltd's equity shares were removed from a stock exchange because the company repeatedly failed to meet listing requirements, without the promoters initiating any exit offer. This is an example of:

This is compulsory delisting by the stock exchange. The shares were removed because of the company's persistent non-compliance with listing requirements, not because the promoters chose to exit. Voluntary delisting would require the promoters to initiate an exit offer to public shareholders.

  1. AVoluntary delisting by the promoters
  2. BCompulsory delisting by the stock exchangeCorrect
  3. CBuy-back through tender offer
  4. DDelisting under a scheme of arrangement approved by the Tribunal

Explanation

Removal by the exchange for non-compliance, with no promoter-initiated exit offer, is compulsory delisting. Voluntary delisting needs promoter initiative. A buy-back or a scheme is unrelated to the facts.

Did you get it right without looking?

One question tells you little. A timed set on Delisting of Equity Shares shows your real accuracy, how long you take and where you lose marks.

Practise Delisting of Equity SharesFree diagnostic mock

More Delisting of Equity Shares questions