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Take the same sample but only raising the NEEDED £15mm to put into the scheme and raise the rest using debt (which I think they should as they continued to pay it down)
100,000 = 1,900,000 rights at a take up of £0.00185 (assuming 100% take up) you will pay £3,515.
Or you could sell 1,198,636 and take up 701,364 and not invest anything further and take partial dilution.
The theoretical Ex Right Price (TERP) will be approx 0.00293
By my calculation:
425,000,000 shares in circulation.
19:1 gives 8,075,000,000 rights / new shares
Amigo want to raise 45m (45,000,000 / 8,075,000,000 = £0.0055) (0.0557276 to be exact)
So if you hold 100,000 shares now:
100,000 = 1,900,000 rights at a take up of £0.0055 (assuming 100% take up) you will pay £10,450.
Or you could sell 1,632,813 and take up 267,187 and not invest anything further and take partial dilution.
The theoretical Ex Right Price (TERP) will be approx 0.0064 so if you do have the money to take up in theory you should not loose.
You don't have to take my word for it, check this yourselves but after working at the likes of JPM and Deutsche bank in Asset servicing for 12 years I have managed many Rights Issues!
Example
Your holding as of Ex date (to be announced) = 10,000
Rights Ratio = 19:1 (for every 1 share you hold you will now have 19)
Current Amigo Share Price = 0.049p
Current Share value = £490
Rights Trading Price (we won't know this until it's announced) = 0.0017p (I used this based on the company raising 15m
Number of Rights = 190,000
To take up the rights you will need to invest a further £323, this would give you a holding of 190,000 new Amigo shoes (or whatever they will be called), which in theory would have a new price of approx £0.004 giving you a new holding a value of £772 (it's about your original value plus what you spent to take up the rights).
or
You could sell the rights and get approx £450
If you do not want to invest any further cash but do not want to be fully diluted, you could split your instruction.
Sell - 79,459 to get £187
buy - 110,541 for £187. These would be worth approx £450 of new shares.
We have no idea the real discount that will be given. I would imagine the rights will trade for 3-4 weeks, so you will have a little time.
Also, take into account that if they offer the rights at 1p, that's takes the take up from £323 to £1900! Makes a massive difference so those with large holdings need to be careful.
IF this passes the shareholder vote then nothing really will stop them raising the money they set out to, as most of the time the Rights Issue will be backed by a broker who will agree to buy up any unsubscribed rights (any type of Corporate Action that has an election involved there is opportunity for them to make money from it).
Hope this helps a little.
What's interesting is if I owned 100% of the company 475,000,000 shares and I didn't want to dilute so I took up 100% at 19:1 that would be 9,025,000,000 rights. For arguments sake lets say the rights trade at 0.5p (half a penny) that would raise £45,125,000.
Don't Amigo only want to raise £15m? To do that the rights price would be around 0.0017p based on todays closing price (0.049)
Please tell me if I am missing something here?
This may help a few people on here.
https://www.youtube.com/watch?v=4K5fBHfPMhM
This will allow you to create a simple excel spreadsheet for calculating cost of a Rights Issue. When the details get announced (Rights price) this will tell you both how much you would need to spend to not be diluted, but also show you how to split your election to sell some and take up some. This will mean you limit your dilution without having to spend any more of your own money.
It only takes about 10 minutes or so and is a clear way of seeing where you stand.
I am still unsure how anyone, including Gary can predict what the ratio of any Rights Issue could be. I believe Gary has said they will need £15m to be raised, ok, at 2p then a 19:1 would be needed. What if the share price is 10p,15p, 25p?! We know how much they need we have no idea what the environment will be like when they decide to pull the trigger.
Who on earth will take up the rights while there is no clear direction?
If you don't take up the rights your holding is diluted but to take up you have to pay the subscription fees, what if people that got in at 250p do not have the money now? They loose out twice.
Give us direction, take administration off the table, get SOA 2.0 approved and then we can talk RI.
Been watching this thread for almost a year since buying in, until now I've controlled the urge to join. I'm not ramping or shorting or anything else just asking a question or venting!
Like many I am very disappointed in this outcome but not entirely surprised.
I am holding my 200k shs, I would very much like to think that the BOD will come up with something (hopefully not wishful thinking)
The judge made clear not only what he wants to see, but what he didn't see evidence off. If an appeal is coming ,would there be an opportunity to submit the details the judge wanted to see that could sway an appeal judge?
Another question I have is while they have not been paying redress, would Amigo have been reviewing all the complaints? Would they know how many of the (70k?) complaints they are actually going to uphold? I would very much hope that it is a case by case basis still and they don't just roll over and pay every one.
Thanks all