Deutsche Börse Extends Rules And Regulations For Neuer Markt - Criteria For Delisting Are Low Share Price, Low Market Capitalization And Insolvency

On Friday, Deutsche Börse AG presented its planned rules for the delisting of companies from the Neuer Markt. The new rule is based on a combination of share price and market capitalization as quantitative criteria, as well as the insolvency of a company as a qualitative criterion. With this step, Deutsche Börse wants to give the Neuer Markt a sharper profile and position itself with respect to the further development of the segment, Executive Board member Volker Potthoff said. "Companies with low market value and insolvent companies are not growth stocks," said Potthoff at a press conference in Frankfurt on Friday. The new rules and regulations will go into effect on October 1, 2001.

The quantitative criterion of market value combines both share price and market capitalization, drawing the line at a daily average price of one euro and a market capitalization of 20 million euros. If a company falls below both these threshold values on 30 consecutive exchange-trading days and fails to exceed both of these two values on at least 15 consecutive days in the next 90 exchange-trading days thereafter, Deutsche Börse will delist the company from the Neuer Markt. The company will be delisted from the segment one month after the announcement is made by Deutsche Börse.

The qualitative criterion of insolvency becomes operative when insolvency proceedings are opened against a company's assets or are dismissed for lack of assets. Under the new rule, Deutsche Börse requires the companies to report insolvency proceedings without delay. Deutsche Börse then publishes the delisting and takes the company out of the Neuer Markt one month after the announcement is made.

Companies that are taken out of the Neuer Markt do not lose their admission to trading on the exchange and can continue to be traded in the second segment (Geregelter Markt) or third segment (Freiverkehr). To be listed in the second segment, a company that has been delisted from the Neuer Markt has to submit an application within three months of its delisting, together with a financial institute or financial services provider admitted to trading on the exchange; for the third segment, an application by the company will be sufficient.