Chinese Hulu-like company Ku6 Media Co Ltd announced on Tuesday that it has received a letter from Nasdaq that claims the company has failed to comply with the stock market's listing rules.
According to the letter, the company was first notified last August that it has failed to regain compliance with the $50 million minimum market value requirement and the $15 million minimum market value of publicly held securities requirement under the Nasdaq listing rule.
It has also indicated that Ku6 Media's American depositary shares will be delisted from the Nasdaq Global Market unless the company appeals the decision to a hearing panel.
"If the company appeals the determination, its shares will continue to trade on Nasdaq Global Market during the process. However, there is no assurance that the hearing panel will grant the company's request for continued listing," said the letter.
In early February, Ku6 Media announced that its board of directors has received a preliminary non-binding proposal letter from Shanghai-based Shanda Interactive Entertainment Limited, the controlling share holder of the company.
According to the letter, Shanda Interactive proposed to acquire the company in a "going private" transaction for $0.0108 per ordinary share, or $1.08 per American depositary shares.
Based on the offer price, the transaction values Ku6 at about $51.5 million in fully enlarged equity value.
Ku6 Media was founded in 2006 and became a subsidiary of Shanda Interactive in 2009. In 2010, it became the first Chinese video website to list on Nasdaq.
