The ADRs of Allied Irish Banks (OTCQB:AIBYY) are nearing the end of a long, strange trip. Until April 2012 AIBYY was a normal ADR, with each ADR representing ownership of 10 underlying shares of Allied Irish Banks (IRE:AIB). These underlying shares were held by the depositary bank, BNY Mellon.
But on April 10, 2012, following the collapse of AIB and its nationalization by the Irish government, AIB terminated the depositary agreement. Termination requires the depositary to sell the underlying shares and return the net cash proceeds to ADR holders in exchange for their ADRs - a process called redemption. Termination is unusual but not unheard of, and redemption is usually quick and orderly.
In the case of AIBYY,...
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