5 May 2022 14:04

Aeroflot to terminate depositary agreement to trade GDR on Frankfurt exchange

MOSCOW. May 5 (Interfax) - Aeroflot plans to terminate its agreement to trade depositary receipts on the Frankfurt Stock Exchange, the Russian airline said in a statement.

"Pursuant to provisions of Federal Law No.114-FZ, dated April 16, 2022, Aeroflot is required to terminate the depository agreement with Deutsche Bank which regulates depository receipts for the Company's shares circulation, issuance and cancellation. The depositary receipts are admitted to trading on the Frankfurt Stock Exchange. Receipt holders have the right to convert them into ordinary shares of PJSC Aeroflot," the company said.

Aeroflot has sent a notice to the Depository Bank to terminate the depository agreement and has notified the Central Bank of Russia of this action.

These changes will not affect shareholders of Aeroflot holding local securities of the company on the Moscow Exchange . Aeroflot shares continue to trade on the Moscow Exchange, have the highest listing level and are included in a number of major exchange indices, including MOEX Russia and RTS indices. As of December 31, 2021, 0.7% of the total number of outstanding ordinary shares of Aeroflot in circulation was converted into depositary receipts.

The Russian law banning Russian companies from trading new depositary receipts for shares on foreign stock exchanges and obliging them to delist existing depositary receipts was enacted on April 27.

Federal Law No. 114-FZ on Amendments to the Federal Law on Joint-Stock Companies and Certain Legislative Acts of the Russian Federation gives companies five business days, until May 5 inclusive, to take "necessary and sufficient" steps to terminate depositary receipt agreements.

Holders of depositary receipts established as of the date the law comes into effect will automatically receive shares of the relevant Russian issuers instead. Shares underlying depositary receipts become non-voting, and dividends will not be paid on them.

The government on April 16 published a resolution, No. 672, 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.