NYSE to delist Chinese telcos

4 Jan 2021

The New York Stock Exchange (NYSE) has said that it will delist China’s three largest telcos – China Mobile, China Telecom and China Unicom – following a US government order in November 2020 barring American investments in entities deemed by Washington to be owned or controlled by the Chinese military, Reuters reports. Responding to the development, a spokesperson for Chinese regulator the China Securities Regulatory Commission (CSRC) said that the Executive Order – which takes effect from 11 January 2021 – was politically motivated and ‘ignored the actual situations of relevant companies and the legitimate rights of the global investors, and severely damaged market rule and order.’ The spokesperson went on to note that the size of the trio’s American Deposit Shares (ADSs) listings were comparatively limited, representing less than 2.2% of their respective total equity shares and with a market capitalisation of less than CNY20 billion (USD3.1 billion). As such, the representative said that the ‘the direct impact of a delisting would be rather limited on the companies’ growth and market performance’.

All three operators have issued statements confirming that trading of the ADSs will be suspended on the NYSE from 7 January. In each of their respective announcements, the trio also highlighted that they had not received notification from the NYSE on the decision to delist their ADSs.

Beijing has warned that it will take ‘necessary measures’ to safeguard the rights of Chinese enterprises, The Global Times writes, citing a statement from the Ministry of Commerce. The statement accused the US government of abusing national security instruments and state powers to crack down on Chinese firms.

China, United States, China Mobile, China Telecom Corporation, China Unicom