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I warned about this yesterday - massive dilution unless folks take up the offer and commit large capital that they may prefer not to at this stage. On top of this selling the money making part of the business just means that cashflow will be even worse going forward and that balance sheet, although stronger, will be under greater pressure than before the sale, given the reduced inflows. The question is with rents going forward and the commercial viability of the assets that are left. Is it worth throwing good money after bad.
Poker yes but more good money after bad?
The retail sector will not recover for some time. HMSO newly designed policy on setting variables rents against an Index is quite inventive however it appears its a means to an end to just ensure rents are paid.
Ultimately the real question will be can they hedge as, whilst prices may be lower at present for occupants it is only merely to secure a foothold. (Some payments are better than none) - I cant see their debtors following suit and reducing their rates against a suffering market place.
" 96% dilution to shareholders !! Never seen anything like this. It’s a near wipeout for shareholders and will be a long long time for the SP to recover to pre covid levels ...if ever !! "
There wont be any dilution to shareholders if they decide to take up their rights and buy the new shares and keep their % ownership of the company... "dilution" is merely refering to the % ownership
The concern is with the capital value of their investment and the feeling that their money will be stuck in here for quite a while
- that is where the immediate pain will be felt
P.S. I think there's a high possibility that ex-rights MCap can drop to £0.7B in oct-nov-dec, plus there might be some retail PI's cash outflow for Christmas/N-Year and SA100(jan) due to shrinking income (both: business and employment channels)..
96% dilution to shareholders !! Never seen anything like this. It’s a near wipeout for shareholders and will be a long long time for the SP to recover to pre covid levels ...if ever !!
IMO - I'll wait for month (sep), then possibly another 4 months before taking any longer/mid-term position here.
Short term swings are obviously expected depending on news (crisis/recovery) - so traders might be around over next couple of months for some booty.
Thanks yuri
I dont really get all the RI
I think maybe better for me to run for the hills until sunnier times
Very stressed with all this
FunkySausage - They think sufficient liquidity buffer is sorted (rights + asset disposal at discount, also RCF has some reserves although debt is a bit more expensive) to last through this crisis of couple of years (?) with reasonable losses (and equity drain) - the other stuff is just a technicality.
1B Equity loss is stage one for now, next periods it may fall down to 2B (+rights issue) or slightly below if rental rates stay hammered longer (+occupancy & collections), current MC is around 0.4B, ex-rights 0.9B~1B in sep - still feasible upside potential despite couple of years of loses ahead.
I still don't know if I should run for the hills or batten down the hatches, anyones input would be appreciated, is this going to drop like a stone ?
I dont get how this isnt tanking ? Reading it, it sounds awful but yet hardly any change in price
Its all in the rns for the rights issue
Funky
FunkySausage - thanks, putting dates on my watch-list.
Expected summary timetable of principal events in the UK
Publication of the Prospectus
Thursday 6 August 2020
Restrictions on transfers between the UK Register and SA Register begin
Monday 24 August 2020 (6:00 p.m. UKT)
Latest time and date for receipt of Forms of Proxy
Thursday 27 August 2020 (9:00am UKT)
General Meeting
Tuesday 1 September 2020 (9:00am UKT)
Record date for the Capital Reorganisation
Tuesday 1 September 2020 (5:30pm UKT)
Effective date for the Capital Reorganisation (new ISIN: GB00BK7YQK64)
Wednesday 2 September 2020 (8:00am UKT)
Record Date for entitlements under the Rights Issue
Monday 7 September 2020 (5:30pm UKT)
Despatch of Provisional Allotment Letters
Wednesday 9 September 2020
Dealings in New Shares, nil paid, commence on the London Stock Exchange (ISIN: GB00BK7YQL71 and LSE code HMON)
Thursday 10 September 2020 (8:00am UKT)
Shares marked ex-Rights
Thursday 10 September 2020 (8:00am UKT)
Latest time and date for acceptance and payment in full and registration of renounced Provisional Allotment Letters
Thursday 24 September 2020 (By 11:00am UKT)
Dealings in the New Shares to commence on the London Stock Exchange fully paid (ISIN: GB00BK7YQM88 and LSE code HMOF)
Friday 25 September 2020 (08:00 UKT)
Restrictions on transfers between the UK Register and SA Register end
Friday 25 September 2020 (6:00 p.m. UKT)
Expected summary timetable of principal events in South Africa
Publication of the Prospectus
Thursday 6 August 2020
Restrictions on transfers between the UK Register and SA Register begin
Monday 24 August 2020 (7:00 p.m. SAST)
Last day to trade to attend and vote at the General Meeting
Monday 24 August 2020
Latest time and date for receipt of Forms of Proxy
Thursday 27 August 2020 (10:00am SAST)
Record time and date for voting at the General Meeting
Thursday 27 August 2020
General Meeting
Tuesday 1 September 2020 (10:00am SAST)
Last day to trade in order to qualify to participate in the Capital Reorganisation
Tuesday 1 September 2020
Finalisation and results of General Meeting Announcement on SENS by
Tuesday 1 September 2020 (12:00 p.m. SAST)
Date for trading in Consolidated Shares under the new ISIN GB00BK7YQK64
Wednesday 2 September
Announcement released on SENS in respect of the cash payment applicable to fractional entitlements as a result of the Capital Reorganisation, based on the volume weighted average price of Shares traded on 2 September 2020, less 10%
Thursday 3 September 2020
Record date for the Capital Reorganisation
Friday 4 September 2020 (9:00am SAST)
Last day to trade Shares in order to qualify to participate in the Rights Issue on the JSE (cum rights)
Friday 4 September 2020
Expected date that accounts of dematerialised shareholders at their CSDP or broker will be updated and will receive fraction allocation payments
Monday 7 Sep
I'm not a holder - so can't check myself, trying to figure out how they implement it.
What's 5:1 consolidation date? Or has it already happened?
(and holders will find 5x less shares and dropped valuation on their accounts)?
It's clearly says 15p (UK) or ZAR 3.41 (SA), also consolidation will create some visual swing up, no real effect.
Surely this can't be the ex-rights price or have I read the RNS wrong