China Pauses GDR Approvals, Threatening Europe Share Sale Boom
- CSRC worried GDR sales may threaten domestic market stability
- EV battery giant CATL among firms with GDR listings on hold
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China’s securities regulator is holding up approvals for new applications to sell global depository receipts, according to people familiar with the situation, potentially choking off a lucrative stream of listings in Europe.
The pause stems in part from concern that a substantial portion of GDR issuance is being taken up by Chinese investors who later convert the securities into shares in their home market to profit from persistent price gaps, the people said. The GDRs, primarily listed in Zurich, have tended to trade at discounts. They become fungible with so-called A-shares in mainland China after 120 days.