Shares of Kaspien Holdings Inc. (Nasdaq: KSPN) soared 26.75% to $0.3800 in after-hours trading on Friday. KSPN stock closed the regular session at $0.2964, marking a 2.74% increase. The surge followed news of the company’s intent to delist its stock, adding momentum to the e-commerce marketplace growth platform.
What Delisting Plan Does KSPN Have?
After careful consideration, Kaspien (KSPN) has recently informed The Nasdaq Stock Market LLC (“Nasdaq”) of its decision to voluntarily delist its common stock from The Nasdaq Capital Market. The company plans to file a Form 25 with the U.S. Securities and Exchange Commission (SEC) on or around June 1, 2023. Following this, it is expected that the delisting of the common stock will take effect by approximately June 12, 2023.
Reasons For Voluntary Delisting
Kaspien had previously received written notices from Nasdaq regarding its non-compliance with the minimum bid price and minimum stockholders’ equity requirements for continued listing on The Nasdaq Capital Market. In light of these circumstances, the company’s board of directors (the “Board”) conducted a thorough evaluation and determined that voluntarily delisting from Nasdaq would be in the best interests of both the company and its stockholders.
Factors Considered By The Board
The Board’s decision was based on a comprehensive review of various factors. One significant factor was the likelihood of the company’s inability to regain compliance with Nasdaq’s listing rules, considering the associated costs. Additionally, the Board recognized that delisting would result in lower operating costs and reduce the management time required for compliance activities.
Kaspien expects that its common stock will be quoted on the OTCQB or another market operated by OTC Markets Group Inc. (the “OTC”). Consequently, the company intends to take the necessary actions to ensure the quoting of its common stock on the OTCQB or another OTC market, thereby maintaining a trading market for its stock. However, it is important to note that there is no guarantee that a broker will continue to make a market in the common stock or that trading will persist on an OTC market or elsewhere.
Public Company Status
As of now, Kaspien (KSPN) does not have plans to deregister as a public company under the Securities Exchange Act of 1934. This decision indicates KSPN’s commitment to maintaining its public status while seeking alternative trading avenues.