Severstal asks depositary to consider steps necessary in connection with termination of GDR program due to new Russian law

MOSCOW. April 21 (Interfax) - Severstal has asked GDR depositary Citibank NA to consider steps necessary in connection with the termination of the GDR program in anticipation of a new Russian law on the matter coming into effect, the steel maker said in a statement.

"As at the date of this communication, the depositary has not provided any feedback to Severstal. Therefore, Severstal would also encourage GDR holders to liaise with the depositary in accordance with the terms of the relevant Deposit Agreements and discuss options available to secure their rights, including in connection with the conversion of GDRs into Severstal's ordinary shares," it said.

Severstal told Interfax that there had been "no decision regarding further steps" and that the company was "looking at the options."

Federal Law N114-FZ on Amending the Federal Law On Joint Stock Companies and Certain Legislative Acts of the Russian Federation, published on April 16, provides that circulation of depositary receipts on foreign exchanges will be prohibited 10 days from the date of the law's publication. After the publication, the companies have 5 working days to take "necessary and sufficient" steps to terminate depositary receipt agreements. The same timeframe is provided for the submission of supporting documents to the Bank of Russia.

On Monday, the government published a resolution on the rules for maintaining the listing of depositary receipts of Russian issuers outside Russia. Companies will have five working days - from April 27 up to and including May 5 - to submit applications to the Ministry of Finance with a request to maintain listings.

The decision on maintaining or refusing the listing will be made by a subcommittee of the government commission for monitoring of foreign investments. It will be able to do so not only at the request of the issuers, but also independently in the absence of such an application, the document reads. The decisions shall be made within five working days after the five-day deadline for submission of appeals to the commission.

Steel maker NLMK Group said this week that it planned plans to file a request to continue trading its depositary receipts on the London Stock Exchange.