Boqii Announces ADS Ratio Change

Rhea-AI Summary

Boqii Holding (NYSE American: BQ) has announced a significant change in its American Depositary Shares (ADSs) ratio. The company will modify its ADS to Class A ordinary shares ratio from 1:15 to 1:150, effectively implementing a 1-for-10 reverse split on existing ADSs. This change is scheduled to take effect on January 21, 2025.

ADS holders will be required to exchange every 10 old ADSs for one new ADS through The Bank of New York Mellon, the depositary. For uncertificated ADS holders, no action is required as changes will be automatic. Any fractional new ADSs will be sold by the Depositary, with net proceeds distributed to affected holders. Boqii will continue trading on NYSE American under the symbol 'BQ', with ADS prices expected to increase proportionally, though this is not guaranteed.

Positive

• None.

Negative

• Implementation of 1-for-10 reverse split indicates potential share price concerns
• Mandatory surrender of ADSs may create administrative burden for holders
• Fractional shares will be sold, potentially resulting in small losses for some investors

Insights

Financial Markets Expert

This ADS ratio change represents a technical adjustment that effectively functions as a 1-for-10 reverse split of Boqii's American Depositary Shares. The move will reduce the number of outstanding ADSs while proportionally increasing the share price, a common strategy employed by companies trading at very low share prices to maintain exchange listing requirements and potentially improve trading dynamics.

The change from 1:15 to 1:150 ratio means each new ADS will represent 150 Class A ordinary shares instead of 15. Shareholders will receive 1 new ADS for every 10 old ADSs held. This consolidation could help address concerns about penny stock status and potentially attract institutional investors who often have minimum price requirements for investment consideration.

However, it's important to note that this is purely a mechanical change that doesn't affect the company's underlying market capitalization, operations, or fundamental value. The timing of this move, amid challenging market conditions for Chinese ADSs, suggests possible concerns about maintaining NYSE American listing requirements.

SHANGHAI, Jan. 10, 2025 /PRNewswire/ -- Boqii Holding Limited ("Boqii" or the "Company") (NYSE American: BQ) today announced that it will change its ratio of its American Depositary Shares ("ADSs") to Class A ordinary shares from one (1) ADS representing fifteen (15) Class A ordinary shares to one ADS representing one hundred and fifty (150) Class A ordinary shares (the "ADS Ratio Change"). The ADS Ratio Change is expected to become effective on or about January 21, 2025 (U.S. Eastern Time) (the "ADS Ratio Change Effective Date").

For Boqii's ADS holders, the ADS Ratio Change will have the same effect as a 1-for-10 reverse split on the existing ADSs. Each ADS holder on the ADS Ratio Change Effective Date will be required on mandatory basis to surrender to The Bank of New York Mellon, as depositary, (the "Depositary") for Boqii's ADS program, every 10 old ADSs held in exchange for one new ADSs. No action is required by holders of uncertificated ADSs to effect the ADS Ratio Change as the change will be effected on the books of the Depositary.  

No fractional new ADSs will be issued in connection with the ADS Ratio Change. Instead, the Depositary will attempt to sell any fractional entitlements to new ADSs and the net cash proceeds from the sale of the fractional ADS entitlements (after deduction of fees, taxes and expenses) will be distributed to the applicable ADS holders by the Depositary. Boqii's ADSs will continue to be traded on the NYSE American under the ticker symbol "BQ". As a result of the ADS Ratio Change, the ADS price is expected to increase proportionally, although the Company can give no assurance that the ADS price after the ADS Ratio Change will be equal to or greater than ten (10) times the ADS price before the change.

 About Boqii Holding Limited 

Boqii Holding Limited (NYSE American: BQ) is a leading pet-focused platform in China. It is the leading online destination for pet products and supplies in China with a broad selection of high-quality products including global leading brands, local emerging brands, and its own private label, Yoken, Mocare and D-cat, offered at competitive prices. Boqii's online sales platforms, including Boqii Mall and our flagship stores on third-party e- commerce platforms, provide customers with convenient access to a wide selection of high-quality pet products and an engaging and personalized shopping experience. Its Boqii Community provides an informative and interactive content platform for users to share their knowledge and love for pets.

Safe Harbor Statement 

This press release contains forward-looking statements. These statements are made under the "safe harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. Statements that are not historical facts, including statements about the Company's beliefs and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties, and a number of factors could cause actual results to differ materially from those contained in any forward-looking statement. In some cases, forward-looking statements can be identified by words or phrases such as "may," "will," "expect," "anticipate," "target," "aim," "estimate," "intend," "plan," "believe," "potential," "continue," "is/are likely to" or other similar expressions. The Company may also make written or oral forward-looking statements in its reports filed with, or furnished to, the U.S. Securities and Exchange Commission ("SEC"), in its annual reports to shareholders, in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. Further information regarding such risks, uncertainties or factors is included in the Company's filings with the SEC. All information provided in this press release is as of the date of this press release, and the Company does not undertake any duty to update such information, except as required under applicable law.

For investor inquiries, please contact: 

Boqii Holding Limited
Investor Relations
Tel: +86-21-6882-6051
Email: ir@boqii.com 

View original content:https://www.prnewswire.com/news-releases/boqii-announces-ads-ratio-change-302348055.html

SOURCE Boqii Holding Limited

FAQ

When will Boqii's (BQ) ADS ratio change take effect?

Boqii's ADS ratio change is scheduled to take effect on January 21, 2025 (U.S. Eastern Time).

What is the new ADS to Class A ordinary shares ratio for Boqii (BQ)?

The new ratio will be 1 ADS representing 150 Class A ordinary shares, changed from the previous ratio of 1 ADS representing 15 Class A ordinary shares.

How will the BQ ADS ratio change affect existing shareholders?

Existing ADS holders will need to surrender 10 old ADSs in exchange for 1 new ADS, effectively implementing a 1-for-10 reverse split.

What happens to fractional shares in Boqii's (BQ) ADS ratio change?

Fractional new ADSs will be sold by the Depositary, and the net cash proceeds will be distributed to the applicable ADS holders after deducting fees, taxes, and expenses.

Do BQ shareholders need to take any action for the ADS ratio change?

Holders of uncertificated ADSs do not need to take any action as the change will be automatically effected on the Depositary's books.