Telkom SA will next week set in motion the procedures needed to delist its American Depositary Receipts (ADRs) from the New York Stock Exchange (NYSE) and to terminate its US reporting obligations under the Securities Exchange Act of 1934.
It announced its intention to delist in June this year.
The company expects to file a Form 25 with the Securities and Exchange Commission (SEC) on or about 17 August, providing a copy to the NYSE to effect the delisting on or about 27 August, which should take place about 10 days after the Form 25 is filed. Following this, Telkom will file a Form 15F with the SEC to deregister and terminate its reporting obligations under the Exchange Act.
If Telkom's ADRs are delisted from the NYSE as of 27 August, the last trading day of such ADRs will be 26 August.
The filings will deregister and terminate Telkom's reporting obligations under the Exchange Act for its ADR programme and ordinary shares. Upon filing the Form 15F Telkom`s reporting obligations will be immediately suspended and the deregistration will be effective 90 days after the filing.
Telkom intends to maintain its ADR facility as a Level 1 programme to enable investors to retain their ADRs, which will be tracked on the over-the-counter market in the US. Telkom's ordinary shares will continue to be traded on the JSE.
According to a statement, the Telkom board decided to delist from the New York Stock Exchange given the current global economic climate and the business imperative for the organisation to reduce its cost base.
However, the methodology employed and discipline gained from compliance with the Sarbanes-Oxley reporting requirements will be retained, where appropriate, to ensure strict corporate governance compliance and transparent financial reporting.