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After Failed Ebix Merger And Covid-19 Impact, Yatra May Face Nasdaq Delisting

After Failed Ebix Merger And Covid-19 Impact, Yatra May Face Nasdaq Delisting

Yatra has announced its public offering of $11.5 Mn in June 2020

It was not able to maintain a minimum closing bid price for 30 consecutive days

Nasdaq has given Yatra 180 days to regain compliance

Last Friday (July 31, 2020), Gurugram and New York-based online travel aggregator Yatra received a letter from the Nasdaq stock market notifying the company has not maintained a minimum closing bid price of $1 per share for the past 30 business days. 

According to Nasdaq listing rules, listed companies have to comply with a minimum bid price of $1 per share. If a company fails to maintain this minimum bid price requirement for 30 consecutive business days, a notification letter is issued to the company as in the case of Yatra.

Yatra is now given an initial period of 180 calendar days (till January 25, 2021) to regain compliance with the minimum bid price requirement. If Yatra’s ordinary shares close at $1 or more for at least 10 consecutive business days before January 25, then the company will be considered compliant with the minimum bid price requirement and the shares will continue to be eligible for listing on the Nasdaq capital market. 

Post this initial 180 days period, there is no guarantee whether the company will be considered for an additional 180 day compliance period or not. If Nasdaq decides to not provide such an additional compliance period, then Yatra’s ordinary shares will be subject to delisting. 

Yatra has announced the closing of its underwritten public offering of $11.5 Mn in the last week of June 2020. The company had offered 14,375,000 of its ordinary shares at a public offering price of $0.80 per share. Yatra had intended to use the net proceeds from this offering for general corporate and business purposes.

Just weeks before the public listing announcement, Yatra canceled its ongoing merger with Ebix. The company also filed a plea seeking ‘substantial’ damages for Ebix’s alleged breach of deal terms. In 2019, Ebix had agreed to buy Yatra at an enterprise value of $337.8 Mn.

In June, Yatra has also said that it is in a strong financial condition to weather the Covid-19 storm. The company reported its total available liquidity to be at $32.5 Mn (as of June 4, 2020), while its monthly run-rate operating fixed cost was approximately $1.2 Mn. This means that the company claimed to have enough runway to last for at least 26 months.  

To achieve this financial stability, Yatra had implemented certain cost-saving measures starting in April, including salary cuts by half and freezing salary hikes. 

Founded in August 2006 by Sabina Chopra, Manish Amin and Dhruv Shringi, Yatra provides a full range of travel-related services such as domestic and international air ticketing, hotel booking, homestays, holiday packages, bus ticketing, rail ticketing, activities, attractions, and ancillary services.