Kaixin Auto Holdings Announces Receipt of Nasdaq Letter Regarding Minimum Bid Price
Kaixin Auto Holdings received a notification letter from Nasdaq regarding non-compliance with the minimum bid price requirement. The company has until July 30, 2024, to regain compliance, failing which it may face delisting from the Nasdaq Capital Market.
When a company's stock price falls below a certain threshold, in this case, the $1 minimum bid price required by Nasdaq, it often indicates investor concerns about the company's value or prospects. The bid price is the highest price a buyer is willing to pay for a stock and maintaining a minimum bid price is crucial for continued listing on a major exchange like Nasdaq. The consequences of delisting can include reduced liquidity, loss of investor confidence and limited access to capital markets, which can further depress the stock price and negatively impact the company's financial health.
For Kaixin Auto Holdings, the receipt of the notification from Nasdaq is a clear signal to the market that corrective action is needed. The 180-day compliance period provides a window for the company to improve its stock performance, potentially through strategic initiatives, financial restructuring, or investor relations efforts. However, failure to regain compliance could lead to delisting, which would be a significant blow to the company's reputation and investor relations.
New energy vehicles (NEVs) are a rapidly growing sector in China, driven by government policies, consumer demand for sustainable options and technological advancements. As a company within this sector, Kaixin's performance and stock price could be influenced by these market dynamics as well as its own operational effectiveness. The pressure to maintain or exceed a $1 bid price may drive the company to innovate and improve its competitive stance within the market.
It's important to analyze the broader industry trends and how they might affect a company like Kaixin. If the NEV market is expanding and Kaixin can capitalize on this growth, it may recover its stock price through increased sales and market share. Conversely, if the industry faces headwinds or if Kaixin fails to keep up with its competitors, the company may struggle to meet the Nasdaq's requirements, which could lead to further challenges in raising capital and sustaining growth.
The regulatory framework set by Nasdaq for listing qualifications serves to maintain market integrity and protect investors. The rules ensure that only companies meeting certain criteria remain publicly traded on the exchange. Kaixin's receipt of the non-compliance notice triggers a series of procedural steps outlined by Nasdaq, which includes the initial 180-day period to regain compliance and the possibility of an additional 180-day period if certain conditions are met.
Understanding these regulations is critical for investors and the company alike, as it frames the timeline and legal recourse available to Kaixin. Should the company face delisting, it has the right to appeal, which introduces another layer of legal complexity. The appeal process can impact investor perceptions and the company's planning, as it may prolong the period of uncertainty regarding the stock's listing status.
02/05/2024 - 04:00 PM
HANGZHOU, China, Feb. 05, 2024 (GLOBE NEWSWIRE) -- Kaixin Auto Holdings (“Kaixin” or the “Company”) (NASDAQ: KXIN), a leading new energy vehicle manufacturer and sales platform in China, today announced the receipt of a notification letter (the “Nasdaq Letter”) dated February 1, 2024, from the Listing Qualifications department of the Nasdaq Stock Market (“Nasdaq”), notifying Kaixin that, for the 30 consecutive business days ended January 31, 2024, the Company failed to meet the requirement of maintaining a minimum bid price of $1 per share pursuant to Nasdaq Rule 5550(a)(2)(the “Rule”). The Nasdaq Letter does not impact the Company’s listing on the Nasdaq Capital Market at this time. In accordance with Nasdaq Rule 5810(c)(3)(A), the Company has a period of 180 calendar days, or until July 30, 2024, to regain compliance with the Rule. If, at any time before July 30, 2024, the closing bid price of the Company’s common stock is at least $1.00 per share for a minimum of 10 consecutive business days, Nasdaq will inform the Company that the Company has regained compliance with the Rule.
If the Company does not regain compliance with the Rule by July 30, 2024, but meets the Nasdaq Capital Market initial inclusion criteria set forth in Nasdaq Listing Rule 5505, except for the minimum $1.00 per share bid price requirement, the Company will be granted an additional 180-calendar day compliance period. If the Company does not regain compliance with the Rule by July 30, 2024, and is not eligible for an additional compliance period at that time, Nasdaq Staff will then provide a written notification to the Company informing that its common stock will be delisted. At that time, the Company may appeal the Nasdaq Staff’s delisting determination to the Nasdaq Hearings Panel pursuant to the procedures set forth in the applicable Nasdaq Listing Rules.
The Company intends to monitor the closing bid price of the Company’s common stock and consider its available options in the event that the closing bid price of the Company’s common stock remains below $1.00 per share.
About Kaixin Auto Holdings
Kaixin Auto Holdings is a leading new energy vehicle manufacturer in China, equipped with professional teams with rich experience in R&D, production, and marketing, and production facilities with the capacity of stamping, welding, painting, and assembly operations. Kaixin produces multiple electric passenger and logistics vehicle models. The Company is committed to building up a competitive international market position that integrates online and offline presence and diversified business operations. Leveraging the expertise of its professional teams and driven by the inspiration for innovation and sustainability, Kaixin aims to contribute to achieving the goals of “peak carbon emissions and carbon neutrality”.
Safe Harbor Statement
This announcement may contain forward-looking statements. These statements are made under the "safe harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as "will," "expects," "anticipates," "future," "intends," "plans," "believes," "estimates" and similar statements. Kaixin may also make written or oral forward-looking statements in its filings with the U.S. Securities and Exchange Commission ("SEC"), in its annual report to shareholders, in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. Statements that are not historical facts, including statements about Kaixin’s beliefs and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement, including but not limited to the following: our goals and strategies; our future business development, financial condition and results of operations; the expected growth of the social networking site market in China; our expectations regarding demand for and market acceptance of our services; our expectations regarding the retention and strengthening of our relationships with used auto dealerships; our plans to enhance user experience, infrastructure and service offerings; competition in our industry in China; and relevant government policies and regulations relating to our industry. Further information regarding these and other risks is included in our other documents filed with the SEC. All information provided in this press release and in the attachments is as of the date of this press release, and Kaixin does not undertake any obligation to update any forward-looking statement, except as required under applicable law.
For more information, please contact:
Kaixin Auto Holdings Investor Relations
SOURCE: Kaixin Auto Holdings
Kaixin Auto Holdings received a notification letter from Nasdaq regarding non-compliance with the minimum bid price requirement.
The company has until July 30, 2024, to regain compliance with the minimum bid price requirement.
If the company does not regain compliance by July 30, 2024, and is not eligible for an additional compliance period, Nasdaq Staff will provide a written notification informing that its common stock will be delisted.
The company intends to monitor the closing bid price of the common stock and consider its available options in the event that the closing bid price remains below $1.00 per share.
