Qualitative content analysis reveals consolidation and regulatory costs as primary drivers of corporate delisting, highlighting the shifting economic trade-offs of public equity markets.
Key Points
To investigate the primary rationales and structural drivers behind corporate delistings from the Johannesburg Stock Exchange.
Conducted a qualitative content analysis on the final stock exchange announcements from delisting companies (N=300) between 1999 and 2022.
Performed a descriptive regression analysis to evaluate the robustness of the identified delisting rationales across the multi-decade sample period.
Corporate consolidation accounted for more than 50% of all delisting activity from 1999 to 2022, with the peak volume concentrated in the early 2000s.
Listing requirements, primarily driven by unfavorable cost-benefit trade-offs of remaining listed, represented the second most frequent rationale, followed by liquidations.
Lesser-documented motives, such as transitioning to smaller-cap exchanges or altering sector and name affiliations, each accounted for 2% of delisting activity.