Friday December 19, 03:05 PM
UPDATE 2-Nasdaq to extend listing-rule suspension
By Jonathan Spicer
NEW YORK, Dec 19 (Reuters) - The Nasdaq Stock Market, which suspended minimum requirements for listed companies in October, said on Friday it will extend the change until April 20.
Exchange parent Nasdaq OMX Group Inc asked for regulatory approval to extend the suspension because 'continued extraordinary market conditions' are pushing stocks below $1, where they face delisting.
The U.S. Securities and Exchange Commission has 30 days to decide on the request, which if granted would help to relieve pressure on companies whose share price and market capitalization have been hit by this year's steep sell-off.
Nasdaq (NASDAQ: news) 's current rule suspension is set to expire Jan. 16.
Generally, Nasdaq-listed securities must maintain a market capitalization of more than $35 million. If a company's shares fall below $1 for 30 consecutive days, it receives a letter warning it to boost the price or face delisting after a six-month grace period.
In an October filing with the SEC, the company said 'almost unprecedented turmoil' in world financial markets had undercut the share prices of companies that would otherwise remain suitable for continued listing.
DELISTINGS UP THIS YEAR
Through Dec. 16 this year, Nasdaq had delisted 83 companies, up from 48 last year, and 52 in 2006. The exchange's worst year was 2001 -- the start of the technology-inspired sell-off -- when it delisted 390 stocks for failing to meet the minimum listing requirements.
Nasdaq, which had been home mostly to technology stocks but is now more diversified, also decided to suspend its minimum listing requirement shortly after the Sept. 11, 2001 attacks on the United States.
Rival New York Stock Exchange, run by NYSE Euronext , has never suspended its listing requirements.
But the NYSE, which lists many of the financial companies hardest hit in this year's credit crunch, has delisted 51 companies so far this year, more than twice the number in any of the last six years. See:
NYSE-listed companies generally need to maintain a higher market cap than Nasdaq-listed companies. NYSE sends a warning letter once a company's shares fall below $1, on average, for 30 consecutive days.
(Editing by John Wallace and Jeffrey Benkoe)
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