Russia’s LSR Group to delist GRDs from London Stock Exchange

MOSCOW, Jun 21 (PRIME) -- Russian real estate developer LSR Group plans to delist its global depositary receipt (GDRs) from the London Stock Exchange (LSE) because the listing does not meet its strategic priorities, LSR Group said in a statement on Monday.

“LSR Group … today announces that on 20 June 2021 the company's Board of Directors considered the equity capital markets strategy of the company and concluded that maintaining listing of its Regulation S and Rule 144A global depositary receipts representing interests in the company's ordinary shares on the London Stock Exchange is not LSR’s strategic priority,” the statement read.

Benefits of the listing on the Moscow Exchange have become evident over the past years --  average daily trade in the shares stands at U.S. $1.8 million, while trade in the GRDs on the LSE amounts to only $0.3 million. Delisting of the GDRs will consolidate free-float and raise liquidity on the Moscow Exchange, which may lead to higher trade in the shares and strengthening of LSR’s position on the stock market, the company said.

The board also approved a buyback of GDRs through LSR’s subsidiary Stroikorporaciya at $2.11 per GDR, which is a 3.4% premium to the closing price on the LSE on June 18 and a 2.6% premium to the weighted average price of the securities for the previous month. Stroikorporaciya may spend no more than $163.9 million on the buyback, and the maximum amount of GDRs that may be submitted accounts for 15.08% of the company’s shareholder equity.

The buyback program covers all GDRs excluding the ones owned by the majority shareholder of LSR Andrei Molchanov, affiliates, and by LSR subsidiaries. The company will collect bids until July 20, summarize the results on July 21, and carry out settlements until July 26.

The shareholders who did not submit their GDRs for the buyback will be able to convert them into ordinary shares traded on the Moscow Exchange, or remain holders of GDRs that have no listing on the LSE and keep their voting rights and the rights to receive dividends. They will also be able to sell the GDRs on the over-the-counter market.

“In view of the tender offer and delisting, as well to help maintain an orderly market in the trading of LSR's securities, with effect from close of business on 18 June the depositary (Deutsche Bank Trust Company Americas) has closed its books to the issuance of new GDRs against deposits of shares, until further notice. GDRs issued prior to this date are not affected and may be traded or converted into ordinary shares in accordance with their terms. The company intends to retain GDR program following delisting,” the company said.

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