Metal Sky Star Acquisition Corporation Announces Receipt of Notice from Nasdaq Regarding Delayed Filings and Failure to Close One Or More Business Combinations

Rhea-AI Summary

Metal Sky Star Acquisition (Nasdaq: MSSA) has received a notice from Nasdaq regarding potential suspension and delisting of its securities. The company faces two issues: failure to complete a business combination within 36 months of its IPO registration statement's effectiveness, and delayed filings of its Q1 2024 10-Q and FY 2023 10-K reports. MSSA has until August 14, 2024 to request an appeal, which would stay the suspension for 15 days. The company submitted a compliance plan on July 30, 2024. If no action is taken, MSSA's securities may be suspended and delisted from the Nasdaq Capital Market on August 16, 2024.

Positive

• Company has submitted a plan to regain compliance with Nasdaq Listing Rules
• Option to request an appeal and potentially stay the suspension

Negative

• Failure to complete a business combination within required timeframe
• Delayed filing of Q1 2024 10-Q and FY 2023 10-K reports
• Risk of suspension and delisting from Nasdaq Capital Market
• time (until August 14, 2024) to request an appeal

Insights

Financial Analyst

Metal Sky Star Acquisition 's failure to complete a business combination within the required timeframe and its delayed filings pose significant risks for investors. This situation typically leads to the liquidation of the SPAC, returning funds to shareholders, but often at a loss compared to the initial investment. The potential delisting from Nasdaq further complicates matters, as it could severely impact liquidity and market value.

The company's appeal to Nasdaq and its compliance plan submission indicate attempts to rectify the situation. However, the multiple compliance issues and the looming August 16 deadline suggest a high risk of delisting. Investors should be prepared for potential rapid developments and consider the implications of holding securities that may soon be delisted or part of a liquidating entity.

Legal Expert

The notice from Nasdaq highlights two critical compliance issues: failure to complete a business combination and delayed financial filings. These violations of Nasdaq rules IM-5101-2 and 5250(c)(1) respectively, create a complex legal scenario. The company's right to appeal and request a hearing is a standard procedural safeguard, but the dual nature of the violations complicates their defense.

Investors should note that while a hearing request can temporarily stay the suspension, it doesn't guarantee a favorable outcome. The Panel's decision will likely hinge on the viability of the company's compliance plan. The tight timeline - with the appeal deadline of August 14 - adds pressure and uncertainty to the situation. This case underscores the importance of timely regulatory compliance for public companies, especially SPACs with specific timeline requirements.

New York, NY, Aug. 13, 2024 (GLOBE NEWSWIRE) -- Metal Sky Star Acquisition Corporation (Nasdaq: MSSA) (the “Company”) announced that it has received a notice (the “Notice”) from The Nasdaq Stock Market LLC (“Nasdaq”) stating that as a result of its failure to complete one or more business combinations within 36 months of the effectiveness of its IPO registration statement, or such shorter time that the Company specifies in its Articles of Association, as amended, in accordance with Nasdaq rule IM-5101-2; and subsequently, the Company fails to timely file its Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2024 (the “Form 10-Q”) and Annual Report on Form 10-K for the period ended December 31, 2023 (the “Delayed Filings”) in accordance with Nasdaq Listing Rule 5250(c)(1), the Company’s securities (units, ordinary shares, warrants, and rights) would be subject to suspension and delisting from The Nasdaq Capital Market at the opening of business on August 16, 2024, unless the Company timely requests a hearing before the Nasdaq Hearings Panel (the “Panel”).

As reported by the Company in its Form 12b-25 filed with the Securities and Exchange Commission (the “SEC”) on April 1, 2024, and May 16, 2024, the Company was unable to file its Form 10-K and Form 10-Q within the prescribed time period without unreasonable effort or expense. The extension period provided under SEC Rule 12b-25 expired.

The Company submitted its plan to regain compliance with the Nasdaq Listing Rule on July 30, 2024. The Delayed Filings serves as an additional and separate basis for delisting, and as such, the Company should address this concern before the Panel if it appeals staff’s determination. Pursuant to the Notice, the Company has until August 14, 2024 to requests an appeal of the determination. A request for a hearing regarding the delinquent filings will stay the suspension of the Company’s securities for a period of 15 days from the date of the request. When the Company requests a hearing, it may also request a stay of the suspension, pending the hearing. A panel will review the request for an extended stay and notify the Company of its conclusion as soon as is practicable but in any event no later than 15 calendar days following the deadline to request the hearing.

About Metal Sky Star Acquisition Corporation

Metal Sky Star Acquisition Corporation is a blank check company formed under the laws of the Cayman Islands for the purpose of effecting a merger, share exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses.

Forward Looking Statements

This press release contains statements that constitute “forward-looking statements”. Forward-looking statements are subject to numerous conditions, many of which are beyond the control of the Company, including those set forth in the Risk Factors section of the Company’s registration statement and final prospectus for the offering filed with the SEC. Copies are available on the SEC’s website, www.sec.gov. The Company undertakes no obligation to update these statements for revisions or changes after the date of this release, except as required by law.

Company Contacts:
Wenxi He
Chairman and Chief Executive Officer

221 River Street, 9th Floor,
Hoboken,NJ 07030
Email: Olivia.he@gmail.com

Source: Metal Sky Star Acquisition Corporation

FAQ

Why is Metal Sky Star Acquisition (MSSA) facing potential delisting from Nasdaq?

MSSA is facing potential delisting due to two main reasons: failure to complete a business combination within 36 months of its IPO, and delayed filings of its Q1 2024 10-Q and FY 2023 10-K reports.

When might MSSA's securities be suspended from trading on Nasdaq?

If no action is taken, MSSA's securities may be suspended and delisted from the Nasdaq Capital Market on August 16, 2024.

What options does MSSA have to avoid delisting?

MSSA can request an appeal by August 14, 2024, which would stay the suspension for 15 days. The company has also submitted a compliance plan to Nasdaq on July 30, 2024.

What reports has MSSA failed to file on time?

MSSA has failed to timely file its Quarterly Report on Form 10-Q for Q1 2024 and its Annual Report on Form 10-K for FY 2023.