Sappi to Voluntarily Delist from NYSE
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Sappi Limited, Johannesburg, South Africa, this week announced its intention to voluntarily delist its American Depositary Shares (ADSs), which are evidenced by American Depositary Receipts (ADRs), from the New York Stock Exchange (NYSE). Sappi will convert its current ADR program into a Level I ADR program to give current ADR holders the option to continue to hold ADRs. Level I ADRs are traded in the U.S. over-the-counter market as opposed to on a U S national securities exchange.
The company's decision to delist from the NYSE is based on the low trading volume of its ADSs on the NYSE as well as the high costs and administrative complexity associated with maintaining its listing and registration in the U S. As of today, less than 1% of Sappi's shares are held through its ADR program, and for the 12 months ended Aug. 28, 2013, less than 1% of Sappi's average daily trading volume occurred on the NYSE, where the company has been listed since 1998.
Sappi says that it believes the resulting savings in costs and management time will benefit the company and its shareholders. Sappi is fully committed to its U S shareholders and believes that the continued trading of the company's ordinary shares on the JSE Limited (JSE), previously known as the Johannesburg Stock Exchange, will provide sufficient liquidity to its shareholders, including its U S shareholders, and access to capital for the company.
"Delisting from the NYSE is in line with Sappi's strategy to reduce costs and improve efficiency. As a South Africa-headquartered company, our primary listing will remain the JSE, as it has been since 1937," said Sappi CEO Ralph Boettger. "Sappi remains committed to high standards of corporate governance and transparency in financial reporting."
Sappi is subject to the JSE Listings Requirements, corporate governance standards as reflected in the guidelines contained in the King Report on Governance for South Africa 2009 as well as laws applicable to publicly listed companies in South Africa. Sappi reiterates its commitment to provide investors with timely information regarding significant business and financial developments. The company expects to continue to host regular investor relations activities, including quarterly earnings reporting, earnings calls, analyst meetings, and investor road shows.
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