AMTD IDEA Group Announces ADS Ratio Change From 1 ADS Representing 2 Ordinary Shares To 1 ADS Representing 6 Ordinary Shares (1-For-3)
Portfolio Pulse from Benzinga Newsdesk
AMTD IDEA Group (NYSE:AMTD) has announced a change in the ratio of its American depositary shares (ADSs) to its Class A ordinary shares from 1:2 to 1:6, effective on November 17, 2023. This change will have the same effect as a one-for-three reverse ADS split. No fractional new ADSs will be issued, and the change will not impact the company's underlying Class A ordinary shares.
November 07, 2023 | 1:46 pm
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AMTD IDEA Group's change in ADS to Class A shares ratio may lead to a short-term decrease in the price of its ADSs due to the reverse split effect. However, the underlying Class A shares will not be affected.
A reverse split reduces the number of shares in circulation, which can lead to an increase in the price per share. However, it can also be perceived negatively by the market as it often occurs when a company's share price is low. In this case, the change in ADS ratio may lead to a short-term decrease in the price of AMTD's ADSs. The underlying Class A shares will not be affected as no ordinary shares will be issued or cancelled in connection with the ADS Ratio Change.
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