OneSmart International Education Stock (ONE): 1-For-25 Reverse Split Goes Into Effect

By Amit Chowdhry ● Jan 24, 2022
  • A 1-for-25 reverse split of OneSmart International Education Group Limited (NYSE: ONE) stock has gone into effect. These are the details.

Earlier this month, OneSmart International Education Group Limited (NYSE: ONE) announced that it will change the ratio of its American depositary shares (ADSs) representing its Class A ordinary shares from 1 ADS representing 40 Class A ordinary share to 1 ADS representing 1,000 Class A ordinary shares.

For OneSmart’s ADS holders, the change in the ADS ratio is going to have the same effect as a 1-for-25 reverse ADS split. There will be no change to the company’s Class A ordinary shares. And the effect of the ratio change on the ADS trading price on the New York Stock Exchange is set to take place at the open of trading today. 

The exchange of every 25 then-held ADSs for 1 new ADS will occur automatically with the then-held ADSs being canceled and new ADSs being issued by the depositary bank, in each case as of the effective date for the ADS ratio change. And OneSmart’s ADSs will continue to be traded on the NYSE under the symbol “ONE”.

No fractional new ADSs will be issued in connection with the change in the ADS ratio. The fractional entitlements to new ADSs will be aggregated and sold by the depositary bank 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 bank.

As a result of the change in the ADS ratio, the ADS price is expected to increase proportionally, but the company can give no assurance that the ADS price after the change in the ADS ratio will be equal to or greater than 25 times the ADS price before the change.

Disclaimer: This content is intended for informational purposes. Before making any investment, you should do your own analysis.