The short trading run for Phoenix Tree Holdings Ltd. (NYSE: DNK) looks like it might come to an end, as New York Stock Exchange announced today that it will delist the company.
The bourse said in a statement today that Phoenix Tree has not provided it with the requested information for February and March. Phoenix Tree, which provides a co-living platform in China, has also failed to “make timely, adequate, and accurate disclosures of information,” to investors, according to the NYSE.
In addition, the stock exchange claims that Phoenix Tree failed to file its required semi-annual financial report in time, and did not even post a press release explaining the tardiness.
There’s been a lot of headwinds surrounding and has been a major disappointment since making its public debut in early 2020, raising $129.6 million. Along with its troubles with the NYSE, multiple law firms launched class-action suits against Phoenix Tree last year.
In particular, The Schall Law Firm claimed that the company made false and misleading statements to the market.
“Phoenix Tree misrepresented the number and nature of renter complaints before its IPO. The Company also misrepresented its exposure to adverse effects on the rental market in China due to the Wuhan coronavirus,” the California-based law firm said in late June.
Also, others including the law firm have questioned the financial strength of Phoenix Tree.
According to local reports late last year, former employees said that the company may declare bankruptcy soon. Phoenix Tree has refuted those reports.
But that’s not all: Phoenix Tree said its former CEO and co-founder Jing Gao came under investigation by the local government in June. According to the company, the investigation is unrelated to Phoenix Tree but pertains to Gao’s business venture before the founding of Phoenix Tree.
In the first three months of 2020, Phoenix Tree’s net loss widened to 51% to $174.3 million compared with the same period in 2019.
While Phoenix Tree will have the right to appeal the NYSE’s decision, the brief trading run is likely over for the company.
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Trading in shares of Phoenix Tree has been suspended since Mar. 15.