Nornickel, a metals giant company from Russia, is the very first company from the country allowed to maintain an abroad listing by the commission of a government. This is allowed for 1 year.
Nornickel stands out as the largest refined nickel and palladium producer in the world. The company, together with others from Russia, has been looking for government approval so they can maintain depositary receipts for foreign bourses trading.
Approval is now needed because President Vladimir Putin signed a bill in April that requires all Russian companies to end their depositary receipts in other countries. This was done in order to reduce the control of foreigners over such companies.
According to Nornickel, the government commission responsible for the approval gave the company the go-ahead after it requested to maintain the ADRs (American Depositary Receipts) they have in other countries. This was requested until the date of April 28, 2023. It was also added that this permission offers the producer the necessary time to assess all the available opportunities and then take the steps necessary to support Nornickel’s long-term attractiveness for investments.
BCS analysts weighed in on the news and declared that this is important because it creates a precedent. As a result, there will most likely be other Russian companies that are going to be allowed to maintain their DR (depositary receipts) trading in other countries. And they are going to be approved for the practice.
BCS also added that the process of maintaining the foreign listing means Nornickel is going to respect standard disclosure and governance practices. It will have a more positive interaction with investors from Western countries in the long run.
Several other Russian companies applied for exactly this permission. This includes MMK, NLMK, Sistema, EN+, Magnit, and Novatek. It is not known if their applications were approved or not at the publish date of this article.