Mullen Automotive (NASDAQ:MULN) announced this morning that it has received a delisting determination letter from Nasdaq’s Listing Qualifications Department. This was expected, as its shares failed to close at or above $1 for at least 10 consecutive business days, but generally no more than 20 consecutive business days, before Sept. 5.
In May, MULN stock had closed at or above $1 for 10 consecutive business days following a 1-for-25 reverse split. Still, the delisting determination evidences that Nasdaq required the company to close at or above $1 for more than 10 consecutive business days. Factors that affected this decision include MULN’s margin of compliance, price trend, trading volume, and the market maker montage.
In response, Mullen has requested a Nasdaq Listing Qualifications Panel hearing. It will ask for a further time extension and to present its plan to regain compliance. MULN would have been delisted on Sept. 15 if Mullen had not requested a hearing. Meanwhile, MULN is down by more than 5% today and nearing its 52-week low of 39 cents.
MULN Stock: Mullen Receives Delisting Notice
Mullen’s requested hearing likely “stays any delisting or suspension action pending the issuance of a final decision by the Panel.” This means that MULN stock will probably remain listed on the Nasdaq while the panel makes up its mind. The electric vehicle (EV) company added that the panel has the discretion to grant it another 180-calendar-day extension to regain compliance.
“The Panel can also exercise that authority to apply additional or more stringent criteria for the continued listing of the Company’s common stock or suspend or delist securities,” said Mullen. “Ultimately, there is no guarantee that the Panel will grant an extension of the compliance period.”
The delisting determination could mark an end to Mullen’s efforts to regain the $1 threshold. After initiating a 1-for-25 reverse split, Mullen later initiated a 1-for-9 reverse split. This ultimately added up to a cumulative reverse split ratio of 1-for-225. The company also approved a $25 million buyback program, of which $5.61 million had been used as of Aug. 29. For now, shareholders will just have to wait for the panel’s decision. Based on MULN’s 99% decline this year, investor sentiment is extremely low.
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On the date of publication, Eddie Pan did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
