Elys Game Technology (NASDAQ: ELYS), a key player in the global online gaming industry, declared on Monday that its common shares will be delisted from the Nasdaq Stock Market the following day, Oct. 17. This development occurred in response to a decision by the Nasdaq Hearings Panel, given that the shares have been consistently trading below $1 for roughly eight months.
In a late Monday statement, Elys explained that their common stock failed to uphold a minimum closing bid price of $1, as necessitated by Nasdaq Listing Rule 5550(a)(2). As a result, the Nasdaq Hearings Panel resolved to delist Elys shares from the exchange. The delisting process will culminate with Nasdaq filing a Form 25 Notification of Delisting with the U.S. Securities and Exchange Commission (“SEC”), subsequent to the completion of applicable appeal periods.
Yearly expenses of approximately $1.6 million have been incurred by Elys to maintain its Nasdaq listing.
Known as a technology provider, Elys Game Technology gains its classification among sports wagering equities due to its supply of sports betting kiosks to businesses like bars and restaurants, which are legally permitted to extend sports betting to their clientele.
While there is an option for the company to challenge the Nasdaq delisting decision, the final decision remains uncertain. With shares closing at 41 cents today and not having closed above $1 on any day in the previous eight months, it appears that a reverse split might be the optimal strategy to regain compliance with the exchange’s listing criteria.
Various factors will come under review in the company’s evaluation, including the likelihood of regaining and maintaining compliance with the continuation of listing requirements via a reverse stock split, as well as analyzing the advantages of remaining listed on Nasdaq against the notable costs and commitment tied to complying with multiple listing requirements.
Post the delisting, Elys shares will continue to trade over-the-counter (OTC) under the existing ticker symbol. However, OTC shares usually draw little or no attention from institutional investors.
Despite being based in Canada and having a market capitalization of a mere $15.91 million as of the current date, Elys has experienced more than a 46% uptick in their stock value year-to-date. This growth was seen despite many professional investors giving the company’s shares a pass.
The company enjoys a diversified geographic presence, thanks to a partnership with Italy’s Lottomatica. Elys isn’t burdened with large-scale debt obligations, an issue common to many gaming operators. Even with its exit from Nasdaq, Elys has pledged to maintain communication with its investors.
Elys plans to continue providing information to stockholders and will make efforts to facilitate the trading of its common stock on the Pink Sheets or another OTC market, to ensure a trading market for its common stock still exists. However, there is no assurance that a market maker will persist in dealing in the common stock, or that trading of such stock will continue on an OTC market or elsewhere.