Citi refused to participate in the forced conversion of depositary receipts
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On August 19, Citi will close the books for the conversion of receipts from Tatneft, Rostelecom and Magnitogorsk Iron and Steel Works (MMK). The Bank has stated that it will not participate in the automatic and forced conversion of depositary receipts, launched August 15, reports “Interfax” with reference to the statement of the credit institution.
Citi stressed that such procedures are outside the scope of custody agreements. In this regard, he notified the holders of depository receipts of Tatneft, Rostelecom and MMK that he would close his books for cancellation at the end of the working day on Friday. The bank expects shares of Russian issuers to be automatically removed from its Russian depository account on 22 August.
A depository receipt is a certificate certifying ownership of a share or bond of a foreign issuer. In fact, this is the same security that the issuer issued, but placed on the stock exchange in another country. There it is traded in the form of a receipt.
April 16 Russian President Vladimir Putin signed the law on the delisting of depositary receipts of Russian companies from foreign markets with subsequent conversion into Russian securities. It will last two or three weeks. Depositary receipts will be written off from the accounts of the owners and the shares of Russian issuers will be credited instead. Issuers are required to notify the depository where the shares for which the receipts are issued no later than 19 August of the launch of such a process.
Details – in the material “Kommersant” “Receipts are being withdrawn from shares”.
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