Tokyo Electron is introducing sponsored ADRs in the US market, with trading available from the 17th. There will be no listing or new share issuance, as the company seeks to broaden its US investor base.
Tokyo Electron announced that it has established a sponsored American depositary receipt (ADR) program, with trading scheduled to begin from the 17th in US Eastern Time. The move is intended to broaden the company’s investor base and raise its profile in the US market, but will not increase the number of Tokyo Electron shares outstanding or change its listing.
The ADRs will be issued at a ratio of 2 ADRs for each original share, with JPMorgan Chase Bank serving as the depositary bank. ADRs are traded in the US and backed by shares of companies outside the US.
Tokyo Electron’s ADRs had previously traded on an unsponsored basis, but will now change from unsponsored to sponsored. Sponsored ADRs are issued under an agreement between the issuing company and the depositary bank.
The article discusses the basic structure of ADRs and outlines the trading framework and key points in the US market.