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Vivendi Delisted From U.S. Stock Markets

Posted by Zonk on from the prop-up-your-worth-in-wow-gold dept.

Despite the success of subsidiary Blizzard's World of Warcraft, Vivendi Universal has delisted itself from U.S. stockmarkets in an effort to cut costs. 1up reports: "Just because they're moving off the American stock market, however, doesn't mean Vivendi Universal won't seek, rely on or utilize US investors. 'Vivendi Universal intends to maintain and develop its business operations in the US, but wishes to reduce financial costs,' says the company's statement."

6 of 29 comments (clear)

  1. Investors beware... by general_re · · Score: 4, Insightful
    Just because they're moving off the American stock market, however, doesn't mean Vivendi Universal won't seek, rely on or utilize US investors.

    Yeah. The problem for those investors is that Vivendi's reporting and disclosure requirements just got a whole lot looser. Better get a real close look at their books if you're planning on sending any money their way.

    --
    ABSURDITY, n.: A statement or belief manifestly inconsistent with one's own opinion.
    1. Re:Investors beware... by MindStalker · · Score: 3, Insightful

      Exactly my thoughts. The article does say "he company has vowed to stand by the US Securities Exchange Act of 1934 and will continue to comply pending their eventual deregistration." But the doesn't mean they are going to be complying with newly enacted reporting requirements, or even anything required since 1934.. :) They arn't legally bought to the act either way. Though I'm sure the European exchange does have its rules, I couldn't help but think new requirements like full disclosure of Executive perks to be a primary reason.

    2. Re:Investors beware... by Dachannien · · Score: 4, Interesting

      Sarbanes-Oxley would be the most likely reason for a company to do something like this, probably so that they don't have to pay for the audits. Of course, the whole reason beyond the Act was to make companies accountable to their shareholders and to the public in general, so if you invest in VU, you should (as the previous posters have said) be aware that you have one less safety net available.

    3. Re:Investors beware... by DerekLyons · · Score: 2, Interesting
      Just because they're moving off the American stock market, however, doesn't mean Vivendi Universal won't seek, rely on or utilize US investors.

      Yeah. The problem for those investors is that Vivendi's reporting and disclosure requirements just got a whole lot looser. Better get a real close look at their books if you're planning on sending any money their way.

      Do keep in mind that, contrary to popular belief, buying stock in a company (other than at IPO) sends no money to the company. The money you pay, less brokerage fees, goes to the previous owner of the company.

      IANAL, but 'not listed on a public exchange' != 'not being a publically traded stock'. They aren't closely held, so they still come under the same disclosure and reporting requirement as well as supervision by the SEC. A stock exchange provides a place to trade stocks - and a level of supervision above and beyond that of the SEC, but it does not replace the SEC.

      There's no legal requirement that you list your stock on one of the big exchanges - but there is a practical one, most brokers won't touch a stock not so listed, or charge an additional fee to do so, as the trade must take place outside of the exchanges network which the broker is connected to. (In theory there is no reason why you cannot open your own exchange.)

  2. Pink Sheet by the+eric+conspiracy · · Score: 2, Interesting

    Investing in something on the pink sheets (unlisted stocks) is so risky that even hucksters like Jim Cramer recommend against it.

  3. What this all means by nelsonal · · Score: 2, Informative

    The company will get a new shiny 5 letter ticker, and will trade on the pink sheets (home to Cadbury, Nestle, Mitsubishi (not the bank), Samsung) and other big relativly safe foreign companies as well as tiny insanly risky domestic stocks. The one unifying feature of trading on the pink sheets is that you do not have to meet SEC filing requirements (which is a feature for the small companies) the big foreign companies usually meet a similar level of disclosure although the accounting rules can differ from domestic ones. This is likely due to the very high costs of becoming Sarbanes-Oxley complient and if they do not need to why spend the money. Big fund holders are unlikely to sell due to this change, since there will still be liquidity enough to allow them to trade.

    --
    Degaussing scares the bad magnetism out of the monitor and fills it with good karma.