STOCKHOLM, Sweden-While other companies have adopted the reverse-stock-split strategy to boost their stock profiles, L.M. Ericsson said it has authorized a ratio change in its American depositary shares with effect from Oct. 23 in compliance with the Nasdaq National Market’s listing requirement.
“One new ADS will represent 10 class B-shares,” said Ericsson. “This will result in a technical price adjustment to the ADS corresponding to the ratio change. The current ratio is 1:1.”
The company expects to avoid the possible delisting, which has been hanging over the company.
The ratio change will reduce the number of outstanding ADS from approximately 1.7 billion to approximately 170 million, Ericsson said.
The Ericsson board also authorized its president and chief executive officer to delist its B shares from the Euronext, German and Swiss stock exchanges.
