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FTSE Russell to announce in July decision on adding Snap shares

Published 04/03/2017, 10:16 PM
Updated 04/03/2017, 10:20 PM
© Reuters. Traders gather at the post where Snap Inc. is traded on the floor of the NYSE
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By Heather Somerville and Ross Kerber

SAN FRANCISCO (Reuters) - Index fund provider FTSE Russell expects to announce in July whether it will include in its indexes shares of Snap Inc (NYSE:SNAP) and other companies whose share structure denies investors voting rights.

FTSE Russell, which is part of the London Stock Exchange Group (LON:LSE) Plc, said on Monday that it will consult with stakeholders likely starting this month and conclude at the end of June. The results of the consultation will be announced in July.

Snap, the parent company of messaging app Snapchat, shocked many investors with an initial public offering last month that included a first-of-its kind share structure that offered IPO investors no voting rights.

"FTSE Russell is aware of concerns raised by some stakeholders regarding the prospective index inclusion of securities with no voting rights such as the recent IPO by SNAP Inc," according to a statement from FTSE Russell on Monday.

Clients of FTSE Russell include big fund managers such as BlackRock Inc (NYSE:BLK) and T. Rowe Price Group Inc. It offers popular indexes like Britain's blue-chip FTSE 100 and the Russell 3000 index of U.S. companies.

© Reuters. Traders gather at the post where Snap Inc. is traded on the floor of the NYSE

Although many investors expressed alarm at Snap's unusual governance structure, the company's IPO was still in such hot demand that it pulled off the biggest U.S. technology IPO since Facebook Inc (NASDAQ:FB) in 2012, with a valuation of roughly $24 billion.

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