EMERGING MARKETS INVESTOR: DR NEWS
By Gordon Platt
Companies based in Taiwan that already have global depositary receipt (GDR) programs will explore establishing new Level 1 American depositary receipt (ADR) programs over the next 18 months, according to BNY Mellon. A new structure allows Taiwan-based companies with existing GDR facilities to establish a Level 1 ADR program without the need to submit an application to Taiwan's Financial Supervisory Commission.
Meanwhile, companies based in Russia and China have been actively raising funds in Western markets through single-listed DR programs, which are designed for issuers that are not publicly traded in their home markets. Mail.ru, a Russia-based Internet company that holds a 2.38% stake in Facebook, raised $912 million through an offering of GDRs listed on the London Stock Exchange. Citi is the depositary for the Mail.ru program. The bank also was appointed depositary for a Level 3 ADR program on the New York Stock Exchange for Shanghai-based Noah Holdings, which provides wealth-management services in China. The program was established through a $116 million ADR offering.
China Xiniya Fashion, a men's clothing designer, established a Level 3 ADR on the NYSE through an $88 million initial public offering. RDA Microelectronics, a China-based semiconductor developer, selected Citi as depositary for its Nasdaq-listed Level 3 ADR that was created through a $78 million offering.
The wave of ADR programs from China-based companies shows no sign of cresting.