Yes, that is CHESS Depositary Interest (CDI). That is no problem.
But the problem for us Australian residents is if we want to have the NewCo shares instead of CDI. Yes, we are allowed to convert the CDI to share and vice versa. But can we do it in practice?
I suppose it can be done for those who have the resources to do it. But I still don't know how and at what cost.
People seem to think that will be easy as they can trade US shares easily. But I don't think they realise that when they buy US shares, they actually don't have the legal ownership of those shares; they don't become the share holders of the company. What they buy is actually the equivalent of CDI.
Allkem shareholders, especially who want to hold long term, who want the merger to proceed would be wise to find out first if they can actually convert their CDIs to the NewCo shares whenever they want to. There is a risk that the NewCo stops providing CDI (as I have mentioned in my previous posts). If that happens and they can't convert their CDIs to shares, then they will have to sell their holdings.
Think, find out, and don't assume ... to avoid regret later on!
AKE Price at posting:
$8.38 Sentiment: None Disclosure: Held
