Codere Online comes out fighting after Nasdaq delisting notice
Codere Online Aims for Compliance Ahead of Nasdaq Delisting Deadline
Codere Online, a prominent player in the gambling industry, is currently challenging a delisting notification from the Nasdaq Stock Exchange following its failure to timely submit the 2024 annual report.
On May 16, the Nasdaq issued a “staff determination letter,” indicating its intent to remove Codere Online from the exchange, a significant development for the operator.
The delay in filing the 2024 Form 20-F is attributed to a prolonged audit process. Codere Online recently transitioned to a new independent registered public accounting firm, MaloneBailey LLP, which commenced its partnership with the company on December 31. This change has contributed to the extended timeline for the requisite audit.
In response to the delisting notice, Codere Online has requested a hearing—a process typically scheduled to occur within 30 to 40 days of the formal notification from Nasdaq.
Determined to rectify the situation, Codere Online anticipates filing its 2024 annual report with the Securities and Exchange Commission (SEC) by May 30, ensuring compliance with regulatory obligations.
During the Nasdaq review process, Codere Online may remain active in trading if its suspension is stayed. The operator has submitted documentation to justify why it should not face suspension and is currently awaiting a ruling on this matter.
If Nasdaq does not grant the operator additional time, trading of Codere Online securities could face suspension by June 6.
Codere Online’s Strategies for Exchange Compliance
This is not the first instance where Nasdaq has threatened delisting; in November, the exchange raised concerns about compliance with SEC filing rules. In January, the Nasdaq hearings panel granted Codere Online an extension related to the overdue annual report for the year ending December 31, 2023.
Codere Online successfully met the May 12 extension deadline, submitting the required report on May 1. However, the oversight in filing the 2024 report drew Nasdaq’s delisting response.
CEO Aviv Sher reassured investors on May 16: “We will be appealing this new delisting determination and requesting both a new hearing panel and further stay of any trading suspension. As already communicated to the market, we expect to file our 2024 annual report by the end of May, thereby regaining compliance with Nasdaq listing requirements prior to any hearing.”
The recent transition to MaloneBailey LLP was necessitated by the resignation of Marcum LLP on December 20, 2024. Marcum cited its inability to complete certain audit procedures due to deficiencies in IT controls associated with third-party platforms, alongside inadequate internal controls at Codere Online to address these issues.
Previously, Marcum had taken over from Ernst & Young, S.L., which notified Codere Online it would not seek reappointment in 2023.
In Codere Online’s latest Q1 financial update, the operator reported a net gaming revenue of €57 million ($63.9 million) for the quarter ending March 31, reflecting an 8% increase from the previous year’s figure of €53 million.
This ongoing situation exemplifies the complex regulatory landscape within the gambling sector and highlights the importance of maintaining compliance for sustained operational success. Codere Online’s proactive measures in navigating these challenges underscore its commitment to adapt and thrive within a highly competitive marketplace.
