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Sappi to delist from NYSE to reduce costs

Sappi to delist from NYSE to reduce costs

Photo by Bloomberg

9th September 2013

By: Natalie Greve

Creamer Media Contributing Editor Online

  

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South Africa-based paper and packaging group Sappi on Monday announced its intention to voluntary delist from the NYSE, citing low trading volumes of its shares, as well as high costs and administrative complexity associated with maintaining its listing and registration in the US.

For the 12 months ended August 28, less than 1% of Sappi’s average daily trading volume occurred on the NYSE, where it has been listed since 1998.

The delisting will be effective from September 30.

CEO Ralph Boëttger believed the continued trading of the company’s ordinary shares on the JSE would provide sufficient liquidity to its shareholders, including those in the US, and would provide the company with adequate access to capital.

“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,” he commented.

Sappi would convert its current American Depositary Receipts (ADR) programme into a Level I ADR programme to provide current ADR holders the option to continue to hold ADRs.

Level I ADRs are traded in the US over-the-counter market as opposed to on a US national securities exchange.

The company stated that less than 1% of its shares were held through its ADR programme.

Edited by Mariaan Webb
Creamer Media Senior Deputy Editor Online

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