América Móvil’s Telmex (BMV: TELMEX) said it intends to delist its American depositary shares from the New York Stock Exchange and the Nasdaq and its L Shares from the Mercado de Valores Latinoamericanos en Euros in Madrid (Latibex) and to terminate its American depositary receipt (ADR) programs, through which Telmex offered its stock on U.S. exchanges.
América Móvil that the main purpose of delisting is to obtain efficiencies in its financial reporting and administrative costs after the completion of its recent tender offer for Telmex shares.
The company, which belongs to billionaire Carlos Slim, offered its shares under the ticker symbols TMX on the NYSE, TFONY on the Nasdaq and XTMXL on the Latibex.
Telmex’s shareholders approved the decision at the company’s general extraordinary shareholders’ meeting Dec. 19. The carrier will provide written notice to the NYSE and Nasdaq of its intent to delist, as well as to JPMorgan Chase Bank NA of the termination of its ADR programs. Consequently and in accordance with the deposit agreements, JPMorgan will provide 30 days’ notice of termination to all holders of ADRs.
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Telmex plans to file the related Form 25 with the U.S. Securities and Exchange Commission shortly thereafter and expects the delisting to become effective 10 days after its filing, after which Telmex’s stock will no longer be traded on the NYSE or Nasdaq.
After the delisting, Telmex shares will continue to be traded on Mexican exchange Bolsa Mexicana de Valores. Either Telmex nor América Móvil have not yet determined whether they will seek to delist the shares from the Mexican exchange.
Shareholders are entitled to surrender their ADSs to JPMorgan, as depositary, for cancellation and receive the underlying Telmex shares. After the 30-day period following the termination of the ADR programs, the depositary may sell the underlying shares and hold the cash proceeds uninvested for delivery to an ADR holder against surrender of the ADR.
Telmex will continue to be registered under the U.S. Securities Exchange Act of 1934 (the “Exchange Act”) for the time being, and the company will continue to comply with the Exchange Act.
Once the delisting has become effective and the company meets the criteria for terminating its reporting obligations under the Exchange Act, it intends to file Form 15F with the SEC in order to deregister all classes of its registered securities. Immediately upon filing Form 15F Telmex’s legal obligation to file reports under the Exchange Act will be suspended, and deregistration is expected to become effective 90 days later.
