HWH International Inc. (NASDAQ:HWH), a wholesale pharmaceuticals company, has received a notice from the Nasdaq Hearings Panel on Monday, October 21, 2024, granting the company additional time to comply with the exchange's listing requirements. The notice follows a hearing on October 15, where HWH International presented its compliance plan after failing to meet the minimum market value of publicly held shares (MVPHS) and minimum market value of listed securities (MVLS) required for continued listing on The Nasdaq Global Market.
The company, which is currently listed under the trading symbol HWH, was initially notified of its non-compliance with the MVPHS rule on February 22, 2024, with a 180-day period to regain compliance. Subsequently, on March 7, 2024, HWH International was informed of its failure to meet the MVLS requirement. Both instances of non-compliance could have led to delisting from The Nasdaq Global Market.
However, the Panel's decision allows HWH International to transfer its listing to The Nasdaq Capital Market, where it must demonstrate compliance with the exchange's requirements, including the MVPHS and stockholders' equity rules, within the granted extension period. The company is actively working to fulfill the conditions outlined in its compliance plan to maintain its listing status.
This development is part of ongoing efforts by HWH International Inc., headquartered in Bethesda, MD, to satisfy regulatory standards and continue its operations in the wholesale drug industry. The company, previously known as Alset Capital Acquisition Corp., has been incorporated in Delaware and operates under the organization name 07 Trade & Services.
In other recent news, HWH International has announced significant changes in its financial structure and stock status. The wholesale pharmaceutical company disclosed the conversion of $3,801,759 in debt into equity, issuing 6,034,537 new shares to Alset International Limited and Alset Inc., its majority stockholders. This conversion is expected to enhance the company's balance sheet by decreasing its debt load.
Simultaneously, HWH International faces potential delisting from the Nasdaq Global Market due to failing to meet the minimum market value and bid price requirements. The company has been given a 180-day grace period to regain compliance, needing to achieve a closing bid price of at least $1 for a minimum of ten consecutive business days and meet a minimum market value of $50,000,000.
Despite efforts to address these deficiencies, HWH International has not regained compliance within the given timeframe, initiating the delisting process. However, the company plans to appeal these decisions. Throughout both appeal processes, HWH International's securities are expected to continue being traded.
InvestingPro Insights
Recent data from InvestingPro sheds light on HWH International Inc.'s financial situation, providing context to its Nasdaq listing challenges. The company's market capitalization stands at a modest $18.61 million, reflecting its current struggles. Despite a strong revenue growth of 71.56% in the most recent quarter, HWH is not profitable over the last twelve months, with an operating income margin of -166.16%.
InvestingPro Tips highlight that HWH's stock price has fallen significantly over the last year, with a one-year price total return of -92.04%. This aligns with the company's difficulties in meeting Nasdaq's market value requirements. However, there's a silver lining: HWH has shown a strong return of 49.39% over the last month, possibly indicating some positive market reaction to its efforts to maintain listing compliance.
For investors seeking a deeper understanding of HWH's financial health and market position, InvestingPro offers 7 additional tips, providing a more comprehensive analysis of the company's prospects amidst its regulatory challenges.
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