Five Chinese US-Listed Giants Announce Delisting Plans Over Audits, May Spark $2.4 Trillion Exodus
Five U.S.-listed Chinese state-owned companies unexpectedly announced plans to delist from US exchanges over SEC audit requirements. In separate filings on the Hong Kong Stock Exchange, PetroChina $中石油(PTR.US$ , China Petroleum & Chemical $中石化(SNP.US$ , China Life Insurance $中国人寿(LFC.US$ , Sinopec Shanghai Petrochemical $上石化(SHI.US$ , and Aluminum Corp. of China $中国铝业(ACH.US$ , some of the largest state-owned companies, said they would voluntarily delist their American depositary share (ADRs) from the New York Stock Exchange.
All five companies said to expect an SEC filing to delist the securities by the end of the month, adding that delisting their ADSs would occur ten days after that.
According to the PetroChina filing, continued US listing meant "considerable administrative burden for performing the disclosure obligations," plus the companies complained about low trading volumes on the NYSE.
About 300 businesses based in China and Hong Kong, with over $2.4 trillion in market value, risk being kicked off US Exchanges as the SEC increases scrutiny of the firms. Among the biggest are China Life, PetroChina, China Petroleum & Chemical, Alibaba Group Holding Ltd. $Alibaba(BABA.US$ and Baidu Inc $Baidu(BIDU.US$ .
$Hang Seng TECH Index(800700.HK$ $China Concept Stocks(BK2517.US$ $BABA-SW(09988.HK$ $BIDU-SW(09888.HK$ $Petrochina(601857.SH$ $PETROCHINA(00857.HK$ $China Petroleum & Chemical Corporation(600028.SH$ $CHALCO(02600.HK$ $Aluminum Corporation Of China(601600.SH$ $CHINA LIFE(02628.HK$ $China Life Insurance(601628.SH$ $Sinopec Shanghai Petrochemical(600688.SH$
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whqqq : Hong Kong listed stocks don't trade at a discount to US ADRs in terms of valuations. I think maybe more Chinese firms to voluntarily delist from the US or move their primary listings to Hong Kong.
Revelation 6 : The Chinese companies are only being asked to do what all the other companies already do. Open disclosure of financial and earnings statements for audit. If they can’t meet that requirement, good bye.
Revelation 6 whqqq: I agree. There will be more Chinese companies that delist and move rather than meet the requirement of open audit and inspection. Whether it’s good or bad we’ll have to wait and see. Could go either way.
whqqq Revelation 6: You're right. Every coin has two sides. I think there are both good and bad aspects, but no one can predict which aspect will be more in the end.
Giovanni Ayala :
