In a major blow to United Breweries Group Chairman Vijay Mallya, Nasdaq has decided to delist his US-based infotech solutions company UBICS' common stock from the Nasdaq Small Cap Market at the opening of business on Monday.

However, UBICS' stock will be eligible for trading on the over-the-counter bulletin board from Monday. The company has informed its shareholders of Nasdaq's decision on its website.

UBICS' common stock is being delisted because the company failed to satisfy the terms of an exception imposed by the Nasdaq listing qualifications panel.

The exception required UBICS to demonstrate the market value of publicly held shares worth at least $1 million on or before March 24, followed by the demonstration of the market value of publicly held shares worth at least $1 million for a minimum of 10 consecutive trading days. A UB Group spokesperson refused to comment on the issue.

UBICS' woes began when its auditors, BDO Seidman LLP, resigned last year expressing concern over the purchase of a Boeing 727 and its subsequent lease to a group company. The auditors were worried that the moves might be interpreted under the provisions of the Sarbannes-Oxley Act, 2002, on corporate governance.

Due to a delay in the appointment of fresh auditors, the company filed its interim financial results without a proper audit. As a result, Nasdaq notified UBICS that its common stock would be delisted from the Nasdaq Small Cap Market.

After hearing the company's appeal, the Nasdaq listing qualifications panel decided that its stock would continue to be listed on the exchange, but with certain exceptions.

UBICS had acquired the aircraft from Davis Oil Company at $3,350,000 and spent another $650,000 on renovating it. The aircraft was dry leased to United Breweries Holdings for a monthly rental of $50,000 in December 2002. UBICS recently sold the aircraft to United Breweries Holdings for $4 million.