Delisting of Russian Companies from the Stock Exchange: Causes and Consequences

Dreving, S.R.; Хрустова, Любовь Евгеньевна

doi:10.26794/1999-849x-2020-13-6-86-95

Cited by 2 publications

(2 citation statements)

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“…Many Russian issuers voluntarily delisted in 2015-2019 from foreign exchanges while remaining at Moscow Exchange because of the unfavourable regulation that downgraded the attractiveness of international exchanges. For example, in 2018 MTS withdrew its depository receipts from NYSE after the new agreement on offshore taxation had been imposed [28].…”

Section: Main Reasons For Companies To Delistmentioning

confidence: 99%

Testing Market Reaction On Stock Market Delisting In Russia

Rogova¹,

Belousova

2021

КФ

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This paper expands the available information on the effects of delisting in Russia, and represents a rare empirical analysis of the impact of external events on securities prices in this major global market. We seek to evaluate how stock prices of competing companies fluctuate around the dates of stock market delisting announcements and completion. We analyse stock prices as correlated with company delisting events from 2004 to 2019 on 552 companies on the Russian MOEX Exchange. The event study methodology is used to evaluate the abnormal returns of rival companies close to relevant delisting dates. These data were checked for statistical significance using the standardised Patell residual test. The results indicate a significant competitive effect on stock prices both on the dates of delisting announcement and on completion, with more significant returns close to announcement dates. These effects were found to influence the prospects not just of individual groups of companies, but of all market participants. We may conclude from our results that delisting is not an event limited in effect to only one company, but impacts the industry as a whole, temporarily changing its value. As such, it will interest both shareholders and managers of public companies, and any participants of industries in which delisting occurs.

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Section: Main Reasons For Companies To Delistmentioning

confidence: 99%

Testing Market Reaction On Stock Market Delisting In Russia

Rogova¹,

Belousova

2021

КФ

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“…Currently, there are very few publications devoted to the topic of delisting that use Russian data. Russian authors P. Andrukovich [7], E. Rogova and M. Belousova [8], E. Dreving and L. Khrustova [9], S. Klyev and A. Sorokina [10] mainly discuss such delisting-related questions as the reasons for delisting, the dynamics of stock prices during delisting, the reaction of the stock market to delisting announcements and questions about the delisting of companies in the technology sector, but do not touch upon the issue of factors affecting the probability of company delisting. Thus, we expand the discussion of this topic and provide a deeper understanding of it in the Russian market, which is characterized by a specific market, institutional and legal environment.…”

Section: Introductionmentioning

confidence: 99%

Voluntary Delisting of Russian Companies at Different Stages of Corporate Life Cycle

Кизко,

Черкасова,

Grigorieva

2023

КФ

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Nowadays, the number of companies leaving the stock exchange is steadily increasing. Researchers and practitioners continue to actively discuss the reasons for voluntary delisting and explore the factors that influence the probability of it. However, the results of existing studies are heterogeneous and inconclusive, indicating the need for further research. Thispaper continues the line of research on the determinants of voluntary delisting by studying the delisting of Russian companies. Unlike previous studies, we identify and compare the factors that influence the decision to delist at different stages of the organization’s life cycle. We argue that delisting factors, although specific to each company, should remain similar for firms at the same stage of development. The company-related factors that we test include investment expenditures, profitability, stock volatility and book-to-market ratio. The study is based on a sample of 162 public Russian companies traded on the Moscow Exchange, of which 75 delisted between 2011 and 2019. The Bloomberg database was used to generate the sample of companies. Using the panel probit regression model, we found that firms with greater investment expenditures are less likely to delist at the Introduction and more likely at the Maturity and Decline stages. The results of our research also show that firm stock volatility had a positive effect on the delisting probability of Russian firms at all stages of theirlife cycle, except for the Introduction stage. Finally, we demonstrate that companies at the Introduction and Growth stages are more likely to leave the stock exchange if they have a greater book-to-market ratio. The results of our study can be used by financial analysts and academics to analyze the probability of delisting of public companies at different life cycle stages.

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Delisting of Russian Companies from the Stock Exchange: Causes and Consequences

Cited by 2 publications

References 0 publications

Testing Market Reaction On Stock Market Delisting In Russia

Testing Market Reaction On Stock Market Delisting In Russia

Voluntary Delisting of Russian Companies at Different Stages of Corporate Life Cycle

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