Mullen Automotive Stock News: CEO David Michery attempts to stall NASDAQ for time
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- NASDAQ exchange sent Mullen notice of delisting.
- The delisting of MULN could happen as soon as September 15.
- Mullen is attempting to appeal the delisting decision and gain six months to comply.
- Failing to maintain the MULN share price above $1 is the reason for the delisting.
Mullen Automotive (MULN) stock has gained 1.7% in Friday’s premarket in sharp contrast to the leading equity indices. Part of the reason appears to be encouragement that Mullen management is fighting back against NASDAQ’s delisting announcement by attempting to appeal the decision.
NASDAQ 100 futures are falling in Friday’s premarket for the third session in a row. The equity futures are off 0.2% one hour before the open, while the S&P 500 and Dow futures are down just 0.1%.
Mullen stock news: Michery attempts to gain NASDAQ extension
Mullen management announced on Thursday that they had appealed the delisting decision to the Nasdaq Listing Qualifications Panel. The electric vehicle maker stated that they may obtain as much as 180 days to bring MULN’s share price back into compliance.
All the way back in the spring time, the NASDAQ exchange had given Mullen six months to comply with the guidelines that require listed companies to keep their share price above the $1.00 mark. Instead of immediately complying, management led by CEO David Michery diluted the stock by about 10X in order to raise more than $200 million for Mullen’s production ramp-up.
With the MULN stock price trade down near $0.11, in early August the board of directors gave CEO David Michery the authority to perform the stock’s second reverse stock split of the year. This action gave each shareholder one share for every nine shares held previously.
This moved the share price back to $1.00 in time to meet the NASDAQ requirement that MULN trade above the threshold for 10 consecutive sessions prior to September 5. Why Michery did not perform a 1-for-20 reverse split to be on the safe side is anyone’s guess. The chief executive even admitted at the time that his lawyers and executives wanted him to go for a 1-for-50 ratio.
In May of this year, the company had already completed a 1-for-25 reverse split to raise its share price value. That reversal pushed the share price from $0.06 to about $1.50.
The NASDAQ Listing Qualifications Panel “has broad discretionary public interest authority, which includes the discretion to grant the Company up to an additional 180 calendar days from Sept. 5, 2023, to regain compliance,” a Mullen spokesperson said in a statement. “The Panel can also exercise that authority to apply additional or more stringent criteria for the continued listing of the Company’s common stock or suspend or delist securities. Ultimately, there is no guarantee that the Panel will grant an extension of the compliance period.”
Mullen stock forecast
Mullen stock is at the very least holding steady above $0.39. That was the price where MULN discovered support on August 23. There is no reason to think that the share price will recover since it has mostly been in a downtrend for the past five years.
However, expect the share price to increase unnaturally if management is once again given an extension by NASDAQ’s committee. Michery will certainly use it to perform another reverse split.
MULN daily chart
