Currently, Nubank is a publicly traded company, that is, with shares purchased by investors and traded on the stock exchange – both in the United States and in Brazil. Nine months after starting its debut on B3, the startup felt the difficulties of the current moment (political and economic crisis in Brazil) and announced, on Thursday (15), that it needs to restructure its BDR program (Brazilian Depositary Receipts) with level 3 to 1 conversion.
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What does this mean?
With the discontinuation of the level 3 BDRs program, the digital bank may request the cancellation of its registration as a publicly-held company in the country. The company will continue with the status of a publicly-held company only on the New York Stock Exchange (NYSE).
Rationale for change
According to fintech, the objective of the change is to “maximize efficiency”. Due to its dual listing, Nubank needs to have different structures to meet the specific standards of the markets in which its shares are traded.
“Nubank aims to maximize efficiency and scalability, reducing unnecessary duplicated workloads in regulatory requirements, which consume considerable resources,” said, in a note, the co-founder and CEO of Nubank in Brazil, Cristina Junqueira.
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If you are a Nubank account holder, you can rest assured: nothing changes for those who have an account with fintech.
What changes for investors?
Shareholders of Nubank in Brazil with Level III BDRs will have the following alternatives (Bloomberg Línea)
- Migrate to receive Level I BDRs in a 1 to 1 ratio;
- If you have at least six Level III BDRs, exchange them for class A common shares traded on the NYSE, at the rate of 1/6 of a BDR for each share – as long as you have an active brokerage account in the United States;
- Sell Level III BDRs on the market.
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