^

Stock Commentary

Converge to be traded OTC in US markets

Merkado Barkada
Converge to be traded OTC in US markets
The ADRs are “unsponsored”, which means that the depository bank in the US did not consult CNVRG about this listing, and CNVRG will not receive any of the proceeds of the sale.
Merkado Barkada

Converge [CNVRG 34.45 0.14%] announced that a depository bank in the US had filed paperwork with the US SEC to begin over-the-counter trading of unsponsored Converge ADRs. That might sound really impressive, but when I break it down you’ll see why this is not really about CNVRG so much as it is about giving American investors a way to invest in CNVRG. So, first off, “ADRs” are American Depository Receipts, and each ADR is a certificate that represents ownership of some number of stock in the target company.

Each ADR will be sold for the US $5.00 per certificate, and each certificate represents the right to receive 25 common shares of CNVRG. The depository bank plans to sell up to 500,000 of these ADRs.

The ADRs are “unsponsored”, which means that the depository bank in the US did not consult CNVRG about this listing, and CNVRG will not receive any of the proceeds of the sale. The ADRs will be traded under the symbol “CVGYY”, but they will not be listed on any US exchange; instead, the stocks are available over-the-counter (OTC), which is a peer-to-peer trading system that is not facilitated by any exchange.


MB BOTTOM-LINE

So while the listing is by no means impressive, it does imply that there is some interest abroad for investing in CNVRG.

It’s just not an easy thing to quantify for CNVRG; we kind of know that the existence of that interest means that foreigners are interested in the company and are optimistic about its growth and that the listing itself is a little flash of free press and exposure that will further spread the good news about the stock both at home and abroad. But beyond that, there’s not a lot to say.

Even so, CNVRG didn’t miss the opportunity to put a positive spin on it through a press release (as it should) and reiterate its 55% coverage by 2025 goal and provide a short recap of its recent PH-based network expansion.

CNVRG is just riding the wave of press that it was gifted, and that’s a savvy bit of public/investor relations for a company that has had no shortage of feel-good stories to post in recent months.  

--

Merkado Barkada is a free daily newsletter on the PSE, investing and business in the Philippines. You can subscribe to the newsletter or follow on Twitter to receive the full daily updates.

Merkado Barkada's opinions are provided for informational purposes only, and should not be considered a recommendation to buy or sell any particular stock. These daily articles are not updated with new information, so each investor must do his or her own due diligence before trading, as the facts and figures in each particular article may have changed.

CONVERGE ICT SOLUTIONS INC. PHILIPPINE STOCK EXCHANGE
Philstar
  • Latest
Latest
Are you sure you want to log out?
X
Login

Philstar.com is one of the most vibrant, opinionated, discerning communities of readers on cyberspace. With your meaningful insights, help shape the stories that can shape the country. Sign up now!

FORGOT PASSWORD?
SIGN IN
or sign in with