| Other Photos |
 |
|
 |
The Not-to-Leave Receipt
Deutsche Bank has halted the issue of deposit receipts of Russia’s companies referred to strategic industries of economy. By this move, the bank attempts to protect itself against potential risks incurred as a result of the law on foreign investment restrictions. If other nominal holders of Russia’s stocks follow the example of Deutsche Bank, the future overseas success of Russia’s IPOs will be questionable.
On June 3, Deutsche Bank Trust Company Americas terminated for indefinite time the release of new depository receipts for the stocks of Severstal, NOVATEK, Bashneft, NLMK and Polimentall. Russia’s authorities endorsed May 7 an act on nonresident interest in strategic enterprises and we are studying the legislation and its potential effect on the issuers, people in the bank explained.
Nowadays in Russia, a nonresident investor has six months to notify a regulator about the ownership of over 5 percent in strategic enterprises. Which department will perform the functions of the respective authorized body is yet unclear. Forty two industries of the country are deemed strategic today.
Nonresident depository banks are nominal holders under the GDR programs of all Russia’s issuers. They convert local stocks into receipts, retaining the stocks deposited on their accounts.
“Depository banks don’t understand what to do once the new act has taken effect. They could be viewed end owners of stocks, as the latter are on their balance,” said Troika Dialog Managing Director Andrei Sharonov. Therefore, the banks are to pass all procedures specified by the laws, i.e. notify the authorized body and wait for agreement, should the stake exceeds 5 percent. Russia’s issuers usually release GDRs for 10 percent to 20 percent of authorized capital.
www.kommersant.com
All the Article in Russian as of June 05, 2008
|
|
|
