How can sell suspended shares (2024)

FAQs

How can sell suspended shares? ›

How to get rid of blocked/suspended shares? Since the blocked/suspended shares cannot be sold on the open market (stock exchanges) the only way out is to transfer them to somebody else.

For share trading, there is no option for clients to close off their positions as the market is not trading. The shares will remain in the account until it resumes trading/ are confirmed worthless/ liquidation is completed/ shareholders have been paid out.

When a stock is suspended, it is no longer traded on the exchanges and is not visible on Kite holdings. However, suspended stocks are displayed on Console if it's in the holdings. A stock is suspended from the exchanges due to various reasons, including non-compliance with the regulations.

However, limited or “unsolicited” trading can occur in an OTC stock that has been subject to a trading suspension after the suspension ends but before a Form 211 is approved. This may allow investors to trade the stock when a broker or adviser has not solicited or recommended such a transaction.

If you bought stock before the company suspends trading, the idea's the same. The contract still holds and you'll still get your shares. Your money has been paid, you'll receive the stock (but won't be able to sell it) and you'll get any value that comes to shareholders out of the administration process.

The suspension of the shares will have an influence on its value, however, it does not exactly mean that the value of the stock will turn zero. It only results in a ban on trading in an exchange. Suspension on the shares can be revoked if the company manages to comply with all the regulations of the exchanges.

Suspension of a company from trading by exchange might be for several reasons but once the suspended company complies with all regulations suspension will be revoked and the shares will start trading again.

Trading Suspensions

The Securities and Exchange Commisssion (SEC) is authorized under federal law to suspend trading in any stock for a period of up to 10 business days when it believes that the investing public may be at risk. A number of things can lead to an SEC trading suspension.

Delisted shares cannot be traded on the stock exchange, to sell these shares one needs to trade them in the over-the-counter market. With Sharescart, you can sell or liquidate your shares anytime you please. There are a lot of investors in Sharescart that want to invest in various companies.

Suspended trading occurs for many different reasons, including: A lack of current, accurate, or adequate information about a company, such as when it's not current in its filing of periodic reports. Questions about the accuracy of publicly available information, including the contents of recent press releases.

What is the difference between delisting and suspension? ›

The primary difference between delisting and trading suspension is that delisting is a permanent removal of a company's shares from a stock exchange, while trading suspension is a temporary halt in trading.

The Difference Between a Halt or Delay and a Suspension

Securities exchanges have the power to temporarily halt, in the middle of the trading day, or delay, at the beginning of the trading day, trading on a stock. As opposed to suspensions, which can last two weeks, halts and delays usually last less than one hour.

If you still hold shares after they are delisted, you can sell them—just not on the exchange on which they traded before. Stock exchanges are very advantageous for buying and selling shares. When they delist and trade over the counter (OTC), selling shares and getting a reasonable price for them becomes much harder.

The Impact of Delisting on Investors

Once a stock is delisted, stockholders still own the stock. However, a delisted stock often experiences significant or total devaluation. Therefore, even though a stockholder may still technically own the stock, they will likely experience a significant reduction in ownership.

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Promoter or acquirer will buy back the shares through a reverse book building process. Promoters are required to make a public announcement of buyback by sending out a letter of offer to eligible shareholders and a bidding form. In this case, you, as an eligible shareholder can exit by tendering your shares.

If you still hold shares after they are delisted, you can sell them—just not on the exchange on which they traded before. Stock exchanges are very advantageous for buying and selling shares. When they delist and trade over the counter (OTC), selling shares and getting a reasonable price for them becomes much harder.