NaaS Technology Inc. Announces Plan to Implement ADS Ratio Change

Rhea-AI Summary

NaaS Technology (Nasdaq: NAAS), China's first U.S.-listed EV charging service company, announced a significant change to its American Depositary Shares (ADS) ratio. The company plans to modify the ratio from 1 ADS to 800 Class A ordinary shares to 1 ADS to 3,200 Class A ordinary shares, effectively implementing a 1-for-4 reverse ADS split.

The change is expected to take effect on July 30, 2025. JPMorgan Chase Bank will manage the exchange process, where shareholders must exchange every four existing ADSs for one new ADS. The stock will continue trading under the symbol "NAAS" on Nasdaq, with fractional shares being sold and proceeds distributed to affected shareholders.

Positive

• Expected proportional increase in ADS trading price
• No impact on underlying Class A ordinary shares structure
• Modernization of deposit agreement to current standards

Negative

• Mandatory exchange requirement for shareholders
• Potential loss of value through fractional share liquidation
• No guarantee of maintaining proportional value post-split

Insights

Financial Restructuring Specialist

NaaS's 1:4 reverse ADS split aims to boost share price but doesn't change underlying business fundamentals or company value.

NaaS Technology is implementing what effectively amounts to a 1-for-4 reverse split of its American Depositary Shares by changing the ratio from 1 ADS representing 800 Class A shares to 1 ADS representing 3,200 Class A shares. This technical adjustment will mechanically increase the trading price of each ADS by approximately 4x, though the company appropriately acknowledges there's no guarantee the post-split price will maintain this exact mathematical relationship.

The mechanics involve shareholders exchanging every four current ADSs for one new ADS, with fractional shares being aggregated, sold, and cash distributed to affected holders. Importantly, this action doesn't affect the company's underlying business, cash position, or total market capitalization. No actual Class A ordinary shares are being issued or cancelled—this is purely a change in the packaging of shares for U.S. investors.

The timing suggests compliance considerations, as Nasdaq has minimum price requirements of $1.00 per share. Companies trading below this threshold risk delisting notices. While NaaS doesn't explicitly state this as the motivation, reverse splits are common defensive measures to maintain exchange compliance when share prices have declined significantly. The proportional increase in trading price may also potentially attract institutional investors who have minimum share price thresholds for investment consideration.

BEIJING, July 14, 2025 /PRNewswire/ -- NaaS Technology Inc. (Nasdaq: NAAS) ("NaaS" or the "Company"), the first U.S.-listed EV charging service company in China, today announced that that it plans to change the ratio of its American Depositary Shares (the "ADSs") to its Class A ordinary shares (the "ADS Ratio"), par value US$0.01 per share, from the current ADS Ratio of one ADS to 800 Class A ordinary shares to a new ADS Ratio of one ADS to 3,200 Class A ordinary shares.

For the Company's ADS holders, the change in the ADS Ratio will have the same effect as a one-for-four reverse ADS split.  A post-effective amendment to the ADS Registration Statement on Form F-6 will be filed with the SEC to reflect the change in the ADS Ratio.  The Company anticipates that the change in the ADS Ratio will be effective on or about July 30, 2025 (U.S. Eastern Time).

Each ADS holder of record at the close of business on the date when the change in ADS Ratio is effective will be required to surrender and exchange every four existing ADSs then held for one new ADS. JPMorgan Chase Bank, N.A., as the depositary bank for the Company's ADS program, will arrange for the exchange of the current ADSs for the new ones.  The Company's ADSs will continue to be traded on the Nasdaq Stock Market under the symbol "NaaS."

No fractional new ADSs will be issued in connection with the change in the ADS Ratio.  Instead, 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. The change in the ADS Ratio will have no impact on the Company's underlying Class A ordinary shares, and no Class A ordinary shares will be issued or cancelled in connection with the change in the ADS Ratio.

As a result of the change in the ADS Ratio, the ADS trading price is expected to increase proportionally, although the Company can give no assurance that the ADS trading price after the change in the ADS Ratio will be equal to or greater than four times the ADS trading price before the change.

The depositary and the Company have also agreed to amend the amended and restated deposit agreement, dated as of May 30, 2024, in order to bring it in line with current standards and to reflect the change in the ADS Ratio. 

About NaaS Technology Inc.

NaaS Technology Inc. is the first U.S. listed EV charging service company in China. The Company is a subsidiary of Newlinks Technology Limited, a leading energy digitalization group in China. The Company is one of the leading providers of new energy asset operation services. The Company utilizes advanced technology to intelligently match charging supply with demand, offering electric vehicle users a seamless, efficient, and smart charging experience. Furthermore, NaaS empowers charging stations and charging station operators to optimize their operations, driving greater efficiency and enhancing profitability.

Safe Harbor Statement

This press release contains statements of a forward-looking nature. These statements are made under the "safe harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. You can identify these forward-looking statements by terminology such as "will," "expects," "believes," "anticipates," "intends," "estimates" and similar statements. These forward-looking statements involve known and unknown risks and uncertainties and are based on current expectations, assumptions, estimates and projections about the Company and the industry. All information provided in this press release is as of the date hereof, and the Company undertakes no obligation to update any forward-looking statements to reflect subsequent occurring events or circumstances, or changes in its expectations, except as may be required by law. Although the Company believes that the expectations expressed in these forward-looking statements are reasonable, it cannot assure you that its expectations will turn out to be correct, and investors are cautioned that actual results may differ materially from the anticipated results. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement, including but not limited to the following: NaaS' goals and strategies; its future business development, financial conditions and results of operations; its ability to continuously develop new technology, services and products and keep up with changes in the industries in which it operates; growth of China's EV charging industry and EV charging service industry and NaaS' future business development; demand for and market acceptance of NaaS' products and services; NaaS' ability to protect and enforce its intellectual property rights; NaaS' ability to attract and retain qualified executives and personnel; the COVID-19 pandemic and the effects of government and other measures that have been or will be taken in connection therewith; U.S.-China trade war and its effect on NaaS' operation, fluctuations of the RMB exchange rate, and NaaS' ability to obtain adequate financing for its planned capital expenditure requirements; NaaS' relationships with end-users, customers, suppliers and other business partners; competition in the industry; relevant government policies and regulations related to the industry; and fluctuations in general economic and business conditions in China and globally. Further information regarding these and other risks is included in NaaS' filings with the SEC.

For investor and media inquiries, please contact:

Investor Relations
NaaS Technology Inc.
E-mail: ir@enaas.com 

Media inquiries:
E-mail: pr@enaas.com

View original content:https://www.prnewswire.com/news-releases/naas-technology-inc-announces-plan-to-implement-ads-ratio-change-302504111.html

SOURCE NaaS Technology Inc.

FAQ

What is the new ADS ratio for NaaS Technology (NAAS) and when will it be effective?

NaaS Technology is changing its ADS ratio from 1:800 to 1:3,200 Class A ordinary shares, effectively a 1-for-4 reverse ADS split, expected to be effective on July 30, 2025.

How will the NAAS ADS ratio change affect shareholders?

Shareholders will need to exchange every 4 existing ADSs for 1 new ADS. Fractional shares will be sold and the proceeds distributed to affected shareholders.

Will the NAAS ADS ratio change affect the underlying ordinary shares?

No, the ADS ratio change will have no impact on the company's underlying Class A ordinary shares. No shares will be issued or cancelled.

What happens to fractional shares in the NAAS ADS ratio change?

Fractional ADS entitlements will be aggregated and sold by JPMorgan Chase Bank, with net proceeds distributed to affected ADS holders after deducting fees and expenses.

Will the NAAS stock price change after the ADS ratio adjustment?

The ADS trading price is expected to increase proportionally, though the company cannot guarantee it will be equal to or greater than 4 times the previous trading price.