„By way of background, the GDRs have been admitted to trading on the Main Market since 20 October 2016. At that time, the listing on the London Stock Exchange was chosen in order for the Company to gain access to a larger investor base and also due to the low level of liquidity and accessibility limitations on the Bucharest Stock Exchange. Since then, there has been a steep reduction to the number of GDRs in issue to around 5% of the initial volume at the time of listing, which the Company believes reflects a low level of investors’ interest in the GDRs, especially since 2019, which is corroborated with an increase in investors’ interest in the Bucharest Stock Exchange,” reads the company’s bourse report.
As compared to 2018, the traded value of the GDRs decreased by 97% in 2022 to USD 0.3 million and an average of USD 1,250 per day. As of 31 July 2023, the GDRs accounted for only 0.03% in the Company’s share capital with the total capitalisation of the GDRs only representing USD 2.3 million.
The Bucharest Stock Exchange’s development over the years, the inclusion of the Company in the FTSE Russell EM indices and the market-making services contracted by the Company since September 2021 have made the shares traded on the Bucharest Stock Exchange more attractive, from liquidity perspective, than the GDRs traded on the London Stock Exchange.
„Against this background and considering also the ongoing regulatory compliance and administrative costs the Company incurs as a result of its London listing, the Company does not see a relevant benefit of maintaining this listing. Consequently, the Company is now seeking the cancellation of the listing of its GDRs on the Official List and of their trading on the Main Market”.
The company mentions it has submitted an application to the Financial Conduct Authority for the GDRs to be removed from the Official List of the Financial Conduct Authority and to the London Stock Exchange for trading in the GDRs to be cancelled, both with effect from 26 October 2023.
The last day of trading in the GDRs on the London Stock Exchange is expected to be 25 October 2023. The cancellation of the listing and of trading in the GDRs on the London Stock Exchange is expected to take effect at or about 8:00 a.m. on 26 October 2023.
Petrom has a RON32.5 billion bourse capitalization and in 2023 its shares have added 25%.
(English version by Catalina Apostoiu)