Holders of First Quantum Minerals have been advised that the mining house will be terminating its depository notes agreement, according to a statement from the company.
“First Quantum Minerals Ltd. (“First Quantum” or the “Company”) hereby informs owners of the Zambian Depositary Receipts (“ZDRs”) that on May 3, 2022, Bank of New York Mellon will no longer be the Depositary bank for the ZDRs”, read a statement issued by Pangaea Securities in Lusaka Zambia on 10th February 2022.
A depositary receipt (DR) is a negotiable certificate representing shares in a foreign company traded on a local stock exchange. Depositary receipts allow investors to hold equity shares of foreign companies without the need to trade directly on a foreign market.
“Owners and beneficial owners of the ZDRs are notified that FQM will terminate the Deposit Agreement, dated July 12, 2011 between, FQM and the Bank of New York Mellon, as Depositary (the “Deposit Agreement”)”.
With the termination comes the need for investors in these instruments to make critical investment decisions going forward. “As a result, the existing ZDR facility will be terminated effective at 5:00 pm (Eastern Time) on May 2, 2022. As a result of the termination of the Deposit Agreement described above, holders have until May 5, 2022 to decide if they would like to retain their interest in shares of the Issuer. If they do not surrender their ZDRs and request delivery of the underlying Issuer shares before the Depositary sells those shares, holders will lose the right to receive those shares and instead will be entitled, upon subsequent surrender of their ZDRs, to receive the net proceeds of sale of those shares. The date or dates on which the Depositary will sell remaining deposited Issuer shares has not been determined, but it will not be earlier than May 5, 2022”.