China Liberal Education Holdings Limited Has Regained Compliance with Nasdaq's Minimum Bid Price Deficiency

Rhea-AI Summary

China Liberal Education Holdings (NASDAQ: CLEU) has successfully regained compliance with Nasdaq's minimum bid price requirement, as announced on January 13, 2025. The company received confirmation from Nasdaq's Listing Qualifications Department that it has met the minimum bid price requirement of US$1.00 per share.

The compliance issue originated from an August 21, 2024 notification, when CLEU failed to maintain the required minimum bid price for 30 consecutive business days. To address this, the company implemented a 15:1 share consolidation on December 24, 2024, adjusting the par value from US$0.015 to US$0.225 per share.

Following this action, CLEU maintained a closing bid price above US$1.00 for 10 consecutive business days from December 24, 2024, to January 8, 2025, successfully resolving the compliance issue before the February 17, 2025 deadline.

Positive

• Regained Nasdaq listing compliance, removing delisting risk
• Successfully maintained share price above $1.00 for required period
• Resolved compliance issue ahead of February 17, 2025 deadline

Negative

• Required 15:1 share consolidation to meet minimum bid requirement
• Previous trading history showed sustained price weakness below $1.00

Insights

Financial Compliance Analyst

This regulatory compliance update represents a critical stabilization point for China Liberal Education Holdings. The successful share consolidation (15:1 reverse split) implemented on December 24, 2024, effectively addressed the minimum bid price deficiency, preventing a potential delisting scenario from Nasdaq. While technically positive for maintaining the listing status, reverse splits are generally viewed as a defensive measure that doesn't fundamentally improve company value.

The consolidation reduced the float significantly, potentially impacting trading liquidity. With a relatively small market cap of $113.8 million, the reduced float could lead to increased volatility. The higher nominal share price post-consolidation doesn't change the underlying business fundamentals or market capitalization, but does provide temporary compliance breathing room.

For context, the company's ability to maintain the $1.00 threshold will be important moving forward. Historical patterns show that many companies executing reverse splits for compliance purposes often struggle to maintain the higher price level long-term without fundamental business improvements. The closing of this compliance matter removes an immediate existential threat, but investors should monitor the sustainability of the share price and underlying business metrics.

BEIJING, Jan. 13, 2025 /PRNewswire/ -- China Liberal Education Holdings Limited ("China Liberal" or the "Company") (NASDAQ: CLEU), a China-based company that provides technological consulting services for smart campus solutions and other educational services, today announced that the Company received a written notification (the "Compliance Notice") from the Listing Qualifications Department of the Nasdaq Stock Market LLC ("Nasdaq") dated January 10, 2025, informing the Company that it has regained compliance with the Nasdaq Listing Rule 5550(a)(2) ("Minimum Bid Price Requirement") and the matter is closed.

As previously announced, the Company received a notification letter from the Nasdaq dated August 21, 2024, indicating its failure to maintain a minimum bid price of US$1.00 per share for 30 consecutive business days under Minimum Bid Price Requirement. Pursuant to the Nasdaq Listing Rules 5810(c)(3)(A), the Company was provided with 180 calendar days, or until February 17, 2025, to regain compliance.

To comply with the Minimum Bid Price Requirement, the closing bid price of the Company's ordinary shares must be at least US$1.00 per share for a minimum of 10 consecutive business days at any time prior to February 17, 2025. Therefore, in order to cure the Minimum Bid Price deficiency, the Company has effectuated a share consolidation on December 24, 2024, of which fifteen (15) ordinary shares with par value of $0.015 per share each in the Company's issued and unissued share capital consolidated into one (1) ordinary share with par value of US$0.225.

According to the Compliance Notice, the Company evidenced a closing bid price of its ordinary shares at or greater than US$1.00 per share for 10 consecutive business days from December 24, 2024 to January 8, 2025. Thus, the Company has regained compliance with the Minimum Bid Price Requirement, and the matter is closed.

About China Liberal Education Holdings Limited

China Liberal is an educational services provider headquartered in Beijing, China. China Liberal provides a wide range of services, including technological consulting for Chinese universities to improve their campus information and data management systems, designed to enhance the teaching, operating, and management environment of the universities, thus establishing a "smart campus." Additionally, China Liberal offers tailored job readiness training for graduating students. For more information, please visit the Company's website at http://ir.chinaliberal.com/.

Forward-Looking Statements

This document contains forward-looking statements. These forward-looking statements involve known and unknown risks and uncertainties and are based on the Company's expectations and projections about future events, which the Company derives from the information currently available to the Company. Such forward-looking statements relate to future events or our future performance, including: our financial performance and projections; our growth in revenue and earnings; and our business prospects and opportunities. You can identify forward-looking statements by those that are not historical in nature, particularly those using terminology such as "may," "should," "expects," "anticipates," "contemplates," "estimates," "believes," "plans," "projected," "predicts," "potential," or "hopes" or the negative of these or similar terms. When evaluating these forward-looking statements, you should consider various factors, including our ability to change the direction of the Company; our ability to keep pace with new technology and changing market needs; and the competitive environment of our business. These and other factors may cause actual results to differ materially from any forward-looking statement. Forward-looking statements are only predictions. The forward-looking events discussed in this press release and other statements made from time to time by us or our representatives, may not occur, and actual events and results may differ materially and are subject to risks, uncertainties, and assumptions about us. The Company undertakes no obligation to update forward-looking statements to reflect subsequent occurring events or circumstances, or changes in its expectations, except as required by law. Although the Company believes that the expectations reflected in these forward-looking statements are reasonable, it can provide no assurance that these expectations will prove to be accurate, and it cautions investors that actual results may differ materially from the anticipated results. Investors are encouraged to review the risk factors that may affect future results in the Company's most recent annual report on Form 20-F for the year ended December 31, 2023 and in its other filings with the SEC.

Investor Relations Contact

China Liberal Education Holdings Limited
Email: ir@chinaliberal.com 

Ascent Investor Relations LLC
Tina Xiao
President
Phone: +1 646-932-7242
Email: investors@ascent-ir.com 

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SOURCE China Liberal Education Holdings Limited

FAQ

How did CLEU resolve its Nasdaq minimum bid price deficiency?

CLEU implemented a 15:1 share consolidation on December 24, 2024, which helped maintain the stock price above $1.00 for 10 consecutive business days, meeting Nasdaq's requirements.

When did CLEU receive the initial Nasdaq compliance warning?

CLEU received the initial Nasdaq compliance warning on August 21, 2024, due to failing to maintain a minimum bid price of $1.00 for 30 consecutive business days.

What was the deadline for CLEU to regain Nasdaq compliance?

CLEU had until February 17, 2025, to regain compliance with Nasdaq's minimum bid price requirement.

What is the new par value of CLEU shares after the consolidation?

After the 15:1 share consolidation, CLEU's ordinary shares have a par value of US$0.225, increased from the previous US$0.015.

When did CLEU officially regain Nasdaq compliance?

CLEU officially regained compliance on January 10, 2025, after maintaining the required minimum bid price from December 24, 2024, to January 8, 2025.