Att ComSec Ake holders, page-55

GCar,

I am very glad to hear you are not supporting the merger. Not supporting the merger is by all accounts the sensible choice.

About Australian brokers who manage US listed stocks, you are wrong if you thought they could provide you the facility to hold US shares. Yes, most Australian brokers have facility for us to buy and sell "US shares". But those "US shares" are not the US shares proper; they are US depositary notes, the equivalent of CDIs. You can check if you don't believe me.

And there is no fearmongering in what I said about the danger of ending up holding CDIs. Please me try to explain it once more.

Yes, it is mentioned in the Scheme Booklet that shareholders can convert CDIs to NewCo shares and vice versa. It says:

"Conversion of NewCo CDIs into NewCo Shares

Holders of NewCo CDIs may at any time (following the Implementation Date) request to convert their NewCo CDIs into NewCo Shares listed on NYSE by contacting:
• the NewCo CDI Registry, if their NewCo CDIs are held directly on the NewCo CDI issuer sponsored subregister. NewCo CDI holders will be provided with a CDI cancellation request form for completion and return to the NewCo CDI Registry; or
• their sponsoring participant (usually their broker), if their NewCo CDIs are held on the NewCo CDI CHESS subregister. In this case, the sponsoring broker will arrange for completion of the relevant form and its return to the NewCo CDI Registry. (my emphasis)

The NewCo CDI Registry will then arrange for the transfer of NewCo Shares from CDN to the former NewCo CDI holder and, depending on the request made, issue the NewCo Shares to the former NewCo CDI holder in book-entry form directly on the US share register or deliver to their account held with a participant within The Depository Trust Company, the US central securities depository. Trading on ASXwill no longer be possible." (P. 48)

That sounds easy! Most of us have CHESS participant broker. Our broker can do it, so says the Scheme Booklet. But I was told by Commsec and Nabtrade that was not the case. @Pine10 was told by Commsec that was not the case.

So there is still something uncertain there. That is why I said most of us will end up holding CDIs.

Now, the risk of the NewCo quits its ASX listing and thus culls the CDIs is not my original idea. This the risk that is identified by Kroll. Kroll writes in the Scheme Booklet page 181:

"The benefits expected of the dual listing on the NYSE and ASX, including increased liquidity, visibility among investors and access to investors who may be able to hold listed stocks in Australia but not the US, and vice versa, may not be realised or, if realised, may not be sustained, and the costs associated with a dual listing may ultimately outweigh the anticipated benefits. (my emphasis)

This risk is real.

Sezzle says basically the same thing when it announced last month the removal of ASX listing:

"Sezzle has concluded that the financial, administrative and compliance obligations and costs associated with maintaining an ASX listing are no longer justifiable."

The risk of the NewCo merges with a US or Canadian company and quits its ASX listing is also real. The fact that Livent management could successfully convince Allkem management to agree to this terrible scheme for Allkem shareholders shows to me that Livent management who will be the NewCo management are predatory.

So if in all likelihood we end up being able to hold CDI but not the shares, and there is a risk for the CDI to be cancelled, then surely it is reasonable to say that we may end up losing our perpetual right over the assets and having to sell our holdings off.