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I have been accumulating the subscription shares for a while. They are currently 12.5p to buy and I think they represent exceptional value at this price. If the shares rise 5%, the subscription shares should quintuple.
Hi O&T Yes the gearing is now eye-wateringly impressive, however that has to be balanced against the very short life left - expire end June - and the large spread on the subs, presently 7.5 - 12.5, bid was 5 earlier on. The underlying is ~925 - 928 on the most recent trades, so with the exercise price being 915p the subs are moving over to a discount (sub + ex price < underlying price). Even with further rises in the underlying I would still expect a persisting discount as few will want to hold to expiry as that will mean either exercising (very large cash outlay) or hoping the company will offer post expiry settlement (I can find no commitment on that) and the other factor being the large spread. Despite all that there is distinct value at risk here with as said if there is a 5% lift in the underlying that would take that price to ~ 58p over the ex. If we get that 50p for selling subs before the wind up looks feasible. 4x. 10% gives ~9x. If JMI instead holds at the present sp or falls, don't be surprised at wipe out of the subs. I hold a few and am hopeful. Horse race territory now. ATB. GK.
Hi. Situation is improving with 946p having just been paid for JMI, 31p above the subs 915p exercise price. Just got a quote to buy subs at 23p (was 12p 2w back), so for those interested in acquiring JMI at present it is 8p (~1%) cheaper to buy the subs then subscribe. The subs are now bid at 10.5p, ~100% up on 2 weeks back. With 6 weeks to expiry very much a punt for subs holders. See how it goes. GK.
The original 2015 JMIS offer prospectus states a Trustee will be appointed to exercise any subs that have not been exercised by their holders by the expiry date provided JMI is significantly above the 915 EP. They will then sell the newly created shares into the market and after a deduction for the exercise cost and for fees*from the proceeds, will return the remaining balance pro rata to holders of the subs. https://am.jpmorgan.com/blob-gim/1383254263341/83456/prospectus-sub-shares-23-jan-15.pdf Page 50. *Previously noted these fees range around £50k for other subs. If the case ~1.5p per JMI sub. Notable there have recently been 4x 19k buys of subs @ ~25p. JMI spread 948-955. GK.
Anyone able to explain the drop when nav is 11 quid?
Got it now thanks. Share reorg.