So-Young Announces Extension of Plan to Implement ADS Ratio Change

Rhea-AI Summary

So-Young International (Nasdaq: SY), China's leading aesthetic treatment platform, announced an extension to its planned ADS ratio change implementation. The company previously intended to modify its ADS to Class A ordinary shares ratio from 13:10 to 1:15, effectively implementing a reverse ADS split, scheduled for June 30, 2025. However, So-Young has decided to postpone the change to allow additional time for preparation. The ratio change will automatically process through the depositary bank, with existing ADSs being cancelled and new ones issued. Fractional new ADSs will be sold, with net proceeds distributed to holders. While the stock price is expected to increase proportionally post-change, the company provides no guarantees regarding the final price adjustment.

Positive

• None.

Negative

• Delay in implementing planned ADS ratio change indicates potential internal preparation issues
• Uncertainty regarding the final ADS price after the ratio change
• Fractional ADS holders will be forced to sell their positions

Insights

Securities Restructuring Analyst

So-Young delays its ADS ratio change that would consolidate shares; implementation timeline now uncertain with no reason specified.

So-Young International's announcement represents a significant technical adjustment to its securities structure. The planned change would alter the ratio from thirteen ADSs representing ten ordinary shares to one ADS representing fifteen ordinary shares – effectively consolidating the ADSs at a substantial rate.

The mechanics of this change are noteworthy: currently, investors holding 13 ADSs effectively own 10 Class A ordinary shares. After implementation, they would need only 1 ADS to represent 15 Class A ordinary shares. This means each ADS will represent considerably more underlying value than before, resulting in fewer ADSs outstanding.

The most intriguing aspect is the unexpected delay in implementation. While originally scheduled for June 30, 2025, management has postponed this change indefinitely with only the vague explanation of needing "additional time to finalize preparations." The lack of a new timeline suggests the preparation issues may be non-trivial.

For shareholders, this structure change creates several considerations. The company correctly notes that the ADS price should theoretically increase proportionally, maintaining equivalent value. However, their cautionary language acknowledging no guarantees about post-change pricing indicates awareness that markets sometimes react differently than mathematical theory would suggest.

The handling of fractional shares through liquidation and cash distribution will create minor forced exits from positions for some investors. This administrative complexity may be one factor in the implementation delay, though the company has not specified the exact challenges.

BEIJING, June 20, 2025 /PRNewswire/ -- So-Young International Inc. (Nasdaq: SY) ("So-Young" or the "Company"), the leading aesthetic treatment platform in China connecting consumers with online services and offline treatments, today announced that it is amending the effective date for the previously announced plan for an ADS ratio change.

The Company previously planned to change the ratio of the American depositary shares ("ADSs") to its Class A ordinary shares from thirteen (13) ADSs representing ten (10) Class A ordinary shares to one (1) ADS representing fifteen (15) Class A ordinary shares, with the change originally scheduled to take effect at the open of trading on June 30, 2025 (U.S. Eastern Time). Following further consideration, the Company has decided to take additional time to finalize preparations for the ADS ratio change. An updated timeline will be announced once it becomes available.

For the Company's ADS holders, the ADS ratio change will result in an effect equivalent to a proportional reverse ADS split. There will be no change to the Company's Class A ordinary shares. ADS holders of record on the effective date will not be required to take any action in connection with the ADS ratio change. The exchange of then-held (old) ADSs for new ADS will occur automatically with the then-held ADSs being cancelled and new ADSs being issued by the depositary bank. The ADSs will continue to be traded on Nasdaq under the symbol "SY."

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.

As a result of the change in the ADS ratio, the ADS price is expected to increase proportionally, although the Company can give no assurance that the ADS price after the change in the ADS ratio will be equal to or greater than a proportional price based on ADS price before the change.

About So-Young International Inc.

So-Young International Inc. (Nasdaq: SY) ("So-Young" or the "Company") is the leading aesthetic treatment platform in China connecting consumers with online services and offline treatments. The Company provides access to aesthetic treatments through its online platform and branded aesthetic centers, offering curated treatment information, facilitating online reservations, delivering high-quality treatments, and developing, producing and distributing optoelectronic medical equipment and injectable products. With its strong brand recognition, digital reach, affordable treatments and efficient supply chain, So-Young is well-positioned to serve its audience over the long term and grow along the medical aesthetic value chain.

Safe Harbor Statement 

This announcement contains forward-looking statements. These statements are made under the "safe harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as "will," "expects," "anticipates," "future," "intends," "plans," "believes," "estimates," "confident" and similar statements. Statements that are not historical facts, including but not limited to statements about So-Young's beliefs and expectations, are forward-looking statements. Forward looking statements involve inherent risks and uncertainties. Further information regarding these and other risks is included in the Company's filings with the Securities and Exchange Commission. All information provided in this press release is as of the date of the press release, and So-Young undertakes no duty to update such information, except as required under applicable law.

For more information, please contact:

So-Young

Investor Relations
Ms. Mona Qiao
Phone: +86-10-8790-2012
E-mail: ir@soyoung.com

Christensen

In China
Ms. Charlie Chi
Phone: +86-10-5900-1548
E-mail: charlie.chi@christensencomms.com

In US
Ms. Linda Bergkamp
Phone: +1-480-614-3004
Email: linda.bergkamp@christensencomms.com

View original content:https://www.prnewswire.com/news-releases/so-young-announces-extension-of-plan-to-implement-ads-ratio-change-302486910.html

SOURCE So-Young International Inc.

FAQ

What is the new ADS ratio change for So-Young (SY) stock?

So-Young plans to change its ADS ratio from thirteen ADSs representing ten Class A ordinary shares to one ADS representing fifteen Class A ordinary shares, though the implementation date has been postponed.

When will So-Young's (SY) ADS ratio change take effect?

The original effective date of June 30, 2025, has been postponed. The company will announce an updated timeline once it becomes available.

How will the SY ADS ratio change affect shareholders?

The change will act like a reverse ADS split. Existing ADSs will automatically be cancelled and new ones issued. Fractional ADS holders will have their shares sold and receive cash proceeds.

Will So-Young's stock price change after the ADS ratio modification?

The ADS price is expected to increase proportionally, though the company cannot guarantee the final price will be equal to or greater than the proportional calculation.

Do So-Young (SY) shareholders need to take any action for the ADS ratio change?

No, ADS holders of record on the effective date will not need to take any action. The exchange will occur automatically through the depositary bank.