NYSE suspends APP, seeks to delist
NYSE suspends APP, seeks to delist
NEW YORK (Reuters): The New York Stock Exchange said on Tuesday that it suspended from trading and will seek to delist the shares of Singapore-based Asia Pulp & Paper Co. Ltd, one of the world's largest vertically integrated pulp and paper companies.
The NYSE said it will apply to the U.S. Securities and Exchange Commission to delist APP because the company's 30-day average share price is less than $1. It added that the company will not challenge "this determination."
A company representative declined to comment.
Aside from APP's American Depositary Shares, the NYSE also wants to delist the company's liquid-yield option notes due Nov. 18, 2012, and its guaranteed senior unsecured floating-rate notes due Oct. 4, 2001.
Back in January, the NYSE notified APP that its average share price over 30 days was below $1, and the shares stopped trading on April 4, when they closed at 12 cents.
Because APP failed to convince the NYSE that it could get its price back above $1, it determined that the shares are "not currently suitable" for NYSE trading.
The company has been under heavy pressure to restructure a huge portion of its $11 billion debt, at the same time that it divests non-core assets.
Analysts have warned that a restructuring of the whole group is inevitable because of liquidity problems and they estimate that it has almost $2 billion in notes, coupon payments and bank loans falling due this year.
APP is controlled by the Sinar Mas Group, Indonesia's second- largest conglomerate, which is owned by the Widjaja family. It also has businesses in property, finance, plantation and food making. But the major cash generator is the pulp and paper operations, the largest in Asia outside Japan.
Shares in APP's Indonesian units moved lower on Wednesday partly in reaction to the announcement.
By 2.15 p.m. Jakarta time, PT Indah Kiat Pulp and Paper shares were down four percent at Rp 360, after earlier trading down more than five percent. Shares in paper maker PT Tjiwi Kimia were down 4.25 percent at Rp 225.