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It is gauranteed take up around 32 if private investors wont take these up institutional investors would.
HeresHopin
Tick. At last a bit of logic. One reason for the steep discount is to avoid the possibility of the value of the nil paids becoming negative - clearly that would be a disaster as it would then be illogical to take up the rights in that scenario. The nil paids become 0 when the (pre ex rights) SP reduces to the rights price, ie 32p. I dont think even the biggest pessimist expect RR to sink to 32p just yet!
The underwriters can have sub-underwriters too...who they can place unsold shares too....should the need arise...
I dont see much of an issue spreading around unsold RR shares of 32p ...should the need arise...they would get placed ..and the majority will get taken up...they wouldnt have decided the 32p otherwise..
But yes...the fee for the whole RI gets expensive when you choose the fully underwritten option.....but then out of 2 billion quid....well...
The question is Toff .....how long before the new shares get pre-sold and dumped onto the market....??
no, ex-rights= 54p. nil-paid= 22p
Toff
What will be the Nil Paid value per share assuming your magic number of 106 ?
I worked it out to be 106 - 32 = 74p
So for every share you have the right to buy , you can sell Nil Paid share of 74p
right ??
Are you stupid or what for every 300 shares you get 1000 news shares, so in nutshell you pay 671 for 1300 shares and divide 671 by 13 to get overall price.But looks like you took the plunge and got in towards the end of trading day at 130 and now you are panicking.Stupifity of Toff grows
Sham
The rights issue will most likely succeed but it isn’t a certainty.
If the magic number of £1.066666666 is breached by a fairly large margin I’d imagine investors would boycott it. That would take us into uncharted territory.
“ The group’s credibility now rides on whether investors take up the offer. The share issue has been fully underwritten, with BNP Paribas, Citigroup, Goldman Sachs, HSBC, Jefferies and Morgan Stanley acting as joint global co-ordinators.
Crédit Agricole CIB, Santander, SMBC Nikko and Société Générale are acting as co-lead managers. Goldman and Greenhill are acting as financial advisers to the company. Jefferies and Morgan Stanley are acting as joint sponsors.”
Sham
“So if somebody buys 3 shares today at 117 and he gets to buy 1000 rights via right issue for 1300 shares he has paid 671, which is probably half than your "magic number".
Your maths is as bad as your investment choices
You buy 3 shares today
You’re entitled to 10 new shares (not 1000)
If the price were to fall to £1.066666666
It would be the equivalent of £3.20
Which is the equivalent of 10 new shares.
If you want to argue with me you need to get educated first.
Toff
Not sure that was worth waiting for Toff! You certainly are a legend...................
so based on 10 for 3, current pre rights issue price should be £1.06? i.e 32p x10/3... SP will drop to that level I guess. I could be wrong
Exactly sham: anyone buying now is buying at about 51p per share (assuming they exercise their rights which obviously you would if buying now). Historic prices are all irrelevant now - this is what it's trading at right now.
Still a generous offer when (not if ) company's market cap valuation will return to pre-pandemic numbers.
But you didn't factor in the old legacy value of the old shares which do have an impact surely as they get added into the new value?
So if somebody buys 3 shares today at 117 and he gets to buy 1000 rights via right issue for 1300 shares he has paid 671, which is probably half than your "magic number".
300 old shares gives the rights to
1000 new ones
We know the old shares fluctuate in price
But the new ones are set in stone @32
1000 new shares = £320
Which is the equivalent of
300 old shares at £1.066666666 each.
The legend of ToffAppleton grows
I wondered that as well, but cant be bothered to figure it out. No doubt Toff will tell us his logic
How did you work that one out?
Where did you get this magic number from and what is logic behind it?
Is the magic number the shareprice has to fall below before the shares become cheaper to buy on the open market - rather than the rights issue.
Will that number be breached?
It could well happen.
Toff