OREANDA-NEWS. On 05 August 2008 Dalsvyaz (RTS: ESPK, MICEX: DLSV, ADR OTS FEEOY, Deutsche Bourse & Berlin Stock Exchanges: D7A), leader on the Far East telecommunications stock market, announced an amendment as of July 24, 2008 of the conversion ratio of the company’s Level-1 American Depositary Receipts (ADRs)  which were issued on common shares.

The ADR ratio will be reduced from the ratio of 30:1 to 5:1. As a result, a shareholder which owns one American Depositary Receipt in Dalsvya will hold six ADRs in the company.

The depositary bank JPMorgan Chase is to change the ADR conversion ratio on the following dates:

the record date for ADR holders entitled to receive additional ADRs is July 24, 2008;

the distribution date for additional ADRs is July 31, 2008.

As noted by Sergey Frolov, deputy General Director and CFO of Dalsvyaz, the ADR conversion ratio was changed for the purpose of raising ADR liquidity. Since the time when ADRs were first issued back in 2001, the prices for the underlying asset (the company’s common shares) have risen more than 18-fold, as a result of which Dalsvyaz’s ADRs exceeded the standard price range for peer companies on the US OTC market. A 1:5 ratio will make it possible to lower the price of ADRs from USD120 to USD20, and will also increase the number of ADRs in circulation.

“We decided to opt for this conversion ratio, which would make it possible to decrease the lower limit of the ADR price within the price range of ADR peer companies. Hopefully this move will have a positive impact on the interests of brokers and investors in our company, which looks undervalued compared with its market peers”, Sergey Frolov noted.