SMIC Announces Delisting From NYSE

Shares in the semiconductor manufacturing company were down nearly 5 percent Friday after the announcement.

Binwei Wang
    May 24, 2019 1:00 PM  PT
SMIC Announces Delisting From NYSE
author: Binwei Wang   

Semiconductor Manufacturing International Corp. (NYSE: SMI) announced today it plans to delist its ADSs from the New York Stock Exchange, sending its stock down nearly 5 percent to $5.24 per share.

SMIC said its board of directors has approved the move on a variety of factors including limited trading volume of the ADSs, costs, and the burden of complying with periodic reporting. According to the statement, the decision was not related to the intensifying tensions between the United States and China.

The Shanghai-based component manufacturer will file the delisting form on June 3, while the last day of trading on the NYSE will be on or about June 13, 2019, it said.

SMIC said in the announcement that there are various reasons for delisting application from the NYSE. Firstly, compared with global trading volume, SMIC's ADS trading volume is relatively limited. Meanwhile, maintaining ADS's heavier administrative burden and higher costs in listing on the NYSE and registering with the US SEC and complying with the trading law's periodic reports and related obligations.

Gu Wenjun, the founder and chief analyst of the China semiconductor market research company, said that SMIC continues to maintain ADR, but actively downgrades to OTC market.

He added that SMIC has been considering the move for a long time. He said it was not related to the Sino-U.S. trade war and the recent ban on Huawei Technologies Co. Ltd. by Washington.