Intermediate4 min readDividends and Corporate Actions · 9/9
Delisting: What Happens to Shareholders?
Delisting means a share is removed from the exchange's tables, so you can no longer sell it on screen as before. There are two kinds, voluntary and mandatory, and in both the listing rules set how shareholders can sell their shares.
What you will learn
Tell voluntary from mandatory delisting.
Know how the buyout price for affected holders is set.
Know the deadlines and the vote that protect minorities.
The lesson as a short video · 20 seconds · Watch on YouTubeIn this lesson
Mandatory delistingIt happens by decision of the exchange's listing committee when one of the rules' grounds applies: for example the company fails its disclosure obligations a month after notice, goes six straight months without trading, or breaches the listing rules. Losing a continued-listing condition, such as the free float or the number of shareholders, does not lead straight to delisting: the exchange notifies the company within one month at most of the shortfall, the company has at most two months from that notice to submit a timed plan to meet the condition, and carrying out the plan may take no more than six months (extendable at the company's request with reasons the FRA accepts). If it submits no plan or fails to meet the conditions, the matter goes to the listing committee to proceed with delisting.
Voluntary delistingThe company itself asks for it, through an extraordinary general assembly decision, with procedures to buy the shares of affected shareholders.
Voluntary delisting: the vote and the price
The decision needs at least 75% of the shares present at the assembly. If the FRA's review shows a shareholder or group controls the assembly's decisions, a majority of the minority shares present that are not related to the controllers is also required, and the decision passes only if both conditions are met together. The idea is that the party who wants to delist does not decide alone.
Highest close in the month before the board resolution calling the assembly12.40
Average close over the 3 months before that resolution11.80
Fair value from an independent adviser13.10
Buyout price = the highest13.10
Invented figures. The decision must buy affected holders' shares at the highest of the three values.
ExampleAn invented company, Palm Tourism, wants to delist voluntarily. The highest close in the month before the board resolution calling the extraordinary general assembly to consider delisting is 12.40, the three-month average close 11.80, and the independent fair value 13.10. The buyout price is 13.10. With 1,000 shares tendered, that is EGP 13,100.
The deadlines are short. The FRA explained that the 2025 amendments set a maximum of 25 business days from the assembly decision to final delisting and the buyout: the company files its documents with the exchange within 5 business days, delisting completes within 20 business days of complete documents, and purchases may run daily.
Mandatory delisting: the minority's right
Even in a mandatory delisting, the rules require the company to buy the shares of minority holders who want to sell, or guarantee that someone else does, within three months at most of being notified of the delisting decision, at no less than the fair value set by an independent FRA-registered financial adviser. The company or holders of 5% of the securities may ask for reconsideration within 15 days of the announcement.
Watch outThese windows are short, so following the company's disclosures during a delisting matters. If you do not sell during the buyout period, ask your broker and custodian about the status of your shares afterwards.
Follow delisting disclosures
Delisting decisions and buyouts of affected holders are published as disclosures. Open the disclosures page, find one, and check the price and the window.