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BEIJING - China Liberal Education Holdings Limited (Nasdaq: CLEU), a provider of educational and technological consulting services in China with a market capitalization of $6.8 million, is facing delisting from The Nasdaq Stock Market. According to InvestingPro data, the company’s stock has experienced significant volatility, with a 99% decline in value over the past year. The Nasdaq Listings Qualifications Department issued a Staff Determination Notice on May 7, 2025, citing public interest concerns following the company’s substantial issuance of ordinary shares in December 2024 at a significant discount.
According to the notice, the issuance of ordinary shares and warrants to certain investors was at an equivalent price per share of $0.006, a 96% discount from the minimum price required by Nasdaq rules. This action has been deemed to cause substantial dilution for existing shareholders, prompting Nasdaq to exercise its discretionary authority under Listing Rule 5101 to protect investors and maintain market quality. InvestingPro analysis shows the company trading at just 0.08 times book value, with a current ratio of 16.25, indicating strong short-term liquidity despite recent challenges.
Trading of the company’s securities on The Nasdaq Capital Market is scheduled to be suspended at the opening of business on May 16, 2025, followed by a formal delisting. China Liberal intends to appeal this determination by May 14, 2025, to the Nasdaq’s Hearings Panel. The appeal process will stay the suspension and the filing of the Form 25-NSE, which would remove the company’s securities from listing and registration on Nasdaq, pending the Panel’s decision.
China Liberal’s operations are reportedly unaffected by the delisting notice, and the company plans to submit a plan to regain compliance with Nasdaq’s listing standards. While the company maintains impressive gross profit margins of 64%, InvestingPro data reveals an overall weak financial health score, with negative EBITDA of -$5 million in the last twelve months. Nasdaq’s scrutiny of transactions involving deeply discounted equity securities aligns with its commitment to safeguarding the interests of public shareholders.
This development comes as China Liberal continues to focus on its core services, which include technological consulting for smart campus solutions and job readiness training for university graduates. The information in this article is based on the statements provided in a press release by China Liberal Education Holdings Limited.
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