The Management Board of the Warsaw Stock Exchange (GPW) has amended the Detailed Exchange Trading Rules in UTP System and the Alternative Trading System Rules.
After the amendment, in the case of a split of shares resulting in an “after split” reference price below PLN 0.01, trade in the shares will be automatically suspended and the reference rate and the number of shares in trading will not be adjusted according to the “after split” value.
Effective valuation and safety of trading would be adversely affected by trade in shares whose real market valuation would be less than PLN 0.01 due to a split of the nominal value where the shares would trade at least at a price of PLN 0.01 due to technical parameters of the trading system. As a result of such split, the company’s market valuation would be much higher after the split to the extent unjustified by market conditions,” said Piotr Borowski, Member of the GPW Management Board.
Trade in such shares will not be resumed until the nominal value of the shares is merged to the extent necessary for the “after merger” reference price to be not less than PLN 0.01 (or 0.01 of other trading currency, as applicable).
However, trade will not be resumed if it has been suspended in accordance with other regulations applicable on the market.
Our decision to introduce the new rules of determining the reference price in the case of a split of the nominal value of shares is a continuation of GPW’s policy with regard to penny stocks. We have previously introduced the Alert List for the regulated market and NCAlert for NewConnect,” added Piotr Borowski.
The amendments to the exchange regulations take effect on 5 October 2018.