In December 2017, Xero Limited (Xero) made a surprising announcement that it will delist its shares from the New Zealand Stock Exchange (NZX) at the end of January 2018. On February 02, 2018, Xero was delisted from the NZX to trade solely on the Australian Stock Exchange (ASX). Being one of the star performer in NZX, the announcement is a bitter pill to NZX and a very disappointing if not disturbing development in capital market in New Zealand.
What is the impact of Xero’s delisting on: (1) Chief Executive Officer of Xero, Rod Drury who, owns 40% equity shareholding in Xero at the time of announcement; (2)The NZX itself and the capital market in New Zealand in general
Will the delisting of Xero shares from NZX enhance shareholders’ value? Why?
What are the measures that can be undertaken by NZX to ensure listed companies to remain listed on NZX instead of delisting?