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SWVL Holdings Corp, a global provider of tech-enabled mass transit solutions led by Egyptian tycoon Mostafa Kandil, has announced that it has received a notice from The Nasdaq Stock Market.
The notice indicates that the corporation no longer meets the audit committee requirements outlined in Listing Rule 5605 due to the recent resignations of Messrs. W. Steve Albrecht and Gbenga Oyebode from the Company’s board of directors and audit committee.
SWVL’s audit committee must have at least three independent members, according to Listing Rule 5605(c)(2). However, the committee presently has only one member.
Swvl has been granted a “Cure Period” until June 15, 2023, to return to compliance.
The company is actively engaging in conversations with its current directors to identify acceptable candidates for the audit committee.
It anticipates regaining compliance during the Cure Period.
SWVL Holdings Corp loses unicorn status amid turbulent year
However, a report by Billionaires.Africa revealed that SWVL Holdings Corp, the Cairo-based global tech startup led by Egyptian entrepreneur Mostafa Kandil, has lost its unicorn status after a tumultuous one-year period in which its share price has plummeted, causing its market capitalization to drop by more than $1.36 billion.
The company’s rapid expansion culminated in its Nasdaq debut in April 2022, but it has recently implemented austerity measures due to worsening economic uncertainty and tightening financial conditions, resulting in a decline in the company’s shares. This has been further exacerbated by mounting operating costs and listing costs, resulting in widening losses and a diminished valuation.
Under Mostanfa Kandil’s leadership, SWVL has achieved impressive growth in both gross revenue and market share, with more than 1.4 million riders booking more than 46 million rides on its platform, which is powered by a vast network of thousands of drivers.
Mostanfa Kandil’s SWVL embark on cost-cutting measures
SWVL’s market capitalization has experienced a significant decline of more than $1.36 billion since April 2022, declining from $1.37 billion to $6.68 million, despite its impressive track record, this has led to substantial losses for investors, including Kandil, who owns a 6.35-percent stake in the company.
Despite experiencing a 215-percent increase in revenues to $40.7 million in the first half of its 2022 fiscal year, SWVL faced numerous challenges in the first six months of the year, with losses doubling year-over-year to $161.6 million due to rising expenses related to its SPAC merger and Nasdaq listing in April 2022.
In an effort to boost its valuation and combat its losses, SWVL has implemented stringent measures, including a 50-percent reduction in headcount, pay cuts for executives, and the elimination of unprofitable routes in Egypt, Jordan, and Kenya.
