FXCM Inc., a leading online provider of Forex trading and related services, has been notified by the New York Stock that it is not in compliance with the continued listing standards set forth in Section 802.01C of the Listed Company Manual of the New York Stock Exchange. The minimum average share price for continued listing on the NYSE is $1.00 over a period of 30 consecutive trading days and the average closing price of the FXCM's common stock has fallen below $1.00 per share.
FXCM's shares have been slipping since Black Thursday back in January, when the company was hit hard as a result of the Swiss National Bank's decision to unpeg the franc, sending the currency soaring. The share price before the fall was $17.44. After the crash, it dropped to $2.55 and reached $.89 before the NYSE stepped in with its announcement of the company's non-compliance.
There seems to be only one way to remedy the situation: a reverse stock which the company's Board of Directors had already approved in July in an attempt to stave off being delisted from the NYSE. However, the move still requires shareholder approval, and it will only be voted on at the board's meeting scheduled for September 21, 2015.
Under NYSE rules, FXCM can regain compliance at any time during the six-month cure period if the "?closing share price of its common stock reaches at least $1.00 on the last trading day of any calendar month during the period and also has an average closing share price of at least $1.00 over the 30-trading day period ending on the last trading day of that month or on the last day of the recovery period."
FXCM Confident of Re-Listing
The company believes that despite the notice of a possible future delisting, FXCM's business operation and its activities as an online FX trading broker will not be impacted and indeed, there is every reason to believe that a strong company such as FXCM will have no difficulty meeting the necessary conditions for an NYSE re-listing.
In line with this confidence, and with its share price currently at rock bottom, the NYSE notification presents an opportunity for a hostile takeover by any number of other Forex brokers or at the very least, it is a direct invitation for investors to jump in and start buying up shares in hopes of seeing a lucrative return within a short period of time.
The current action by the NYSE should have little effect on customer satisfaction which has always been high and FXCM continues to offer top services to its client base which according to its website consists of 220,000 active accounts worldwide.
FXCM had $4 trillion in retail trading volume for 2014, employs 800 workers in 13 countries and is regulated across five entities- the USA, UK China, Australia and France. Up until now, it was one of the few Forex companies to be licensed to sell it products in the U.S.