Member Info for Hexam

As far as I understand it Cineworld PLC remains and we retain shares in it (initially at least) hence the Takeover Code does not apply and we get no vote.

The new company will be set up under a different holding company and name and it is this for which the new shares will be issued to the lenders. We have no shares in this new company and so the subsequent rights issue does not apply to us either.

This new company will be private but shares may be listed in the future eg through possible IPO or merger.

In the meantime RoW will be sold but with proceeds not expected to benefit us (according to RNS wording).

That presumably leaves us with shares in a shell?

Happy to be corrected on any of the above (by sensible posters) but one thing that does seem clear is that we get no say.

You can't issue more shares than in the prospectus and it has been fully underwritten so the cash raised will be 1.8bn euros - no more and no less.

As to the discount that is just marketing, it doesn't mean the new shares are actually any cheaper, and I doubt any institutions fall for that trick. Quite a few PIs do though so wouldn't be surprised if we see many selling them at the first opportunity and so creating downward pressure on and shortly after the 24th. That should hopefully be short term if it happens though as the sp looks good value longer term given the trajectory of recovery in both bookings and financials.

Yes. Simple enough?

“You see, the bankrupt company has to be seen to be giving investors ample warning that there shares will be possibly wiped out after the restructuring. Thats their way of covering their own backs against any future lawsuits.”

Perhaps you should tell that to those proposing a lawsuit?

Or maybe instead it is simply better to read things more at face value. The company has given ample warnings of its problems and the possible consequences both before and after going into Chapter 11.

Despite this many on this board chose to brush off any negativity (they’re just covering their back, making the business look bad to force CP into a deal etc.) and anybody trying to point out the serious nature of the predicament they were in were given short shrift. Instead every positive was magnified (or simply invented).

Despite the warnings and the poor financials I still believed there was value in the sp. That’s my bad judgement though and just have to accept it rather than try to find someone else to blame for my own mistakes.

Still, if people ignored the warnings and now want to risk even more money on lawyers that’s their choice but to me it just smacks of desperation and an unwillingness to take responsibility for their own choices.

Every post you make just puts you in a worse light and Bonkers in a better one so just carry on making his point for him.

Just hope you start charging something for the space he seems to be taking up in your head.

Do you think they’ll even get past point 1 though?

Agree that point 4 is where it stops assuming it gets that far. The projections in the cleansing materials confirm that.

I am actually trying to sell some at the moment and not getting a quote so maybe it is just in auction or something and just not tradeable. Not sure why that would make the value disappear but hopefully just temporary for you!

iParsnip - Sorry, yes you can do that and you do end up with more shares than you currently have but that doesn't necessarily mean you are better off as you've foregone 818 x 0.91 = £744 for the rights that you did not sell.

The equation comes back to what I said - it depends on what the you think the sp is going to be on the 24th - more or less than £4.88 plus the price you can sell the rights at (so £5.79 if that price is 91p).

The only shares you cannot buy are the new £4.88 shares equal to number of rights you have sold.

For example if you had 500 rights you can take up all your rights and buy 500 new shares at £4.88p each. Provided you have enough cash to do so.

If you sell 200 rights you will get (currently) about £200 in cash but you will then only be able to buy 300 shares at £4.88p each. Again provided you have enough cash to do so including the £200.

In addition there is no restriction on how many normal ex-rights shares (i.e. priced at £6+) you can buy so long as you have enough money.

I don't know how the screens and options are laid out on HL but suggest that if you are in any doubt call HL and hopefully they can walk you through whatever it is you decide you want to do.

As always it depends on where you feel the sp is going to be on April 24. If you sell your current holding for £6.17 you are buying the rights for £4.88 plus the £1 you would have got if you had sold then instead. So it's really costing you £5.88 plus additional charges so it looks like you are gaining a bit.

However, you are basically locking into that price of £5.88 and are at risk to how it moves. If the sp is higher on the 24th then it would have been a good move. If it's less than £5.88 then you would have been better off selling the rights instead and waiting until then to buy. The only thing for certain is that you would have been much worse off doing what you are suggesting yesterday than you are now. Who knows whether that will be the case next week before the deadline? So it's a gamble depending, on where you think the price is going to the 24th, as to if and when you decide to load up.

iParsnip - haha, think I've posted more than enough in the last few days to bore everybody - including myself :)

There's a big difference between understanding the maths and making the best choices though - and the maths has been done to death now. Much like you I'm still undecided what to do about most of my holding. I'm just glad I didn't sell any rights yesterday when the sp seemed like it was only going one way - tempting as it was. The price action has been crazy the last few days and unlike typical RIs so it's even harder than normal to know what it is going to do next. There's seems to be the usual lazy accusations that the erratic price movement is all down to MM games but there's a lot more to it than that (affordability and complexity of RI, rights being sold into stickier hands as they are being bought by people who want to exercise them, good news today and many other factors no doubt). The MMs are given far too much credit in how much they can influence and are just an easy scapegoat.

I sold a few rights at 89p and took some up as well so I'll probably keep doing the same - i.e. effectively tail swallowing, but if the rights price goes much about £1 then I'll probably just sell the rest instead.

That's not because I don't have much confidence in TUI - quite the contrary. I think the sp is a real bargain at the moment. It's just that the most pressure on an sp in an RI tends to be when the new shares are first tradeable so I'll be looking to buy shares then with the rest of my proceeds from selling my rights (and maybe a good few more). Could easily be a bad move though and the sp could hold up or even surge but then I'll be happy that the TUI shares I've retained will be doing well.

In short, l don't know what is going to happen next and despite my longer term optimism I'm not confident enough about the short-term sp to put more money in and will invest more later even though waiting means I might miss the boat in the meantime.

“Cine is actually barely profitable in 2022.”

I think that’s a bit of an understatement - it appears to be showing a thumping great loss (over $1bn) though part of that is due to additional Ch11 costs etc.

Sorry ge0rge don't understand the question. The rights price is currently 29p. This is derisory but still worth selling at IF you think the share price when the new shares are allocated and can be first traded (on April 24th) is going to be lower than 4.88 + 0.29 = £5.17 as you would be better off buying them then on the open market rather than forgoing the 29p now and paying £4.88p for the new shares via the rights issue.

I don't know what the price will actually be when the new shares start trading so don't know the answer (and still haven't made a decision on most of my shares).

I think Greylady is right, £1.90 was the their best price soon after it launched (think it opened initially around £1.75) - see technical chart on TUIB page.

'Fear + confusion' = panic in my book but semantics aside I agree there is a big issue of affordability with this rights issue that isn't helping

iParsnip - I said first thing today I thought this could fall much further and it already has but I think it could still go down even more. I'm not normally that good with short term sp predictions and don't usually even bother to try but it seems in full scale panic mode at the moment. It's crazy because as Greylady says - why are so many people jumping ship now when this RI improves the balance sheet so much and nothing else much has changed?

So I wouldn't be surprised to see the 37p go to zero - or if the price rebounds in style. Who knows? Certainly not me.

Stille - Sounds like I'm agreeing with you :)

I'm not quite sure what you mean Marcinkus about making a larger loss if you sell the rights, nor can I follow your numbers, but what is the case is that by selling the rights you are crystallising the loss - as with any sell when you are underwater. That means what you have left needs to work harder to recover any loss.

It really is a case for me of looking beyond just the maths. This drop however you work it out is severe but if you have confidence in TUI so think it will reverse and are willing to risk more capital then buying is the way to go just as with any other investment but if you have doubts or have risked as much as you want to already then reducing or maintaining your holding would make more sense.

Thanks but I'm obviously not thinking so clearly at the moment though as the mistakes are creeping in! Yes, the censoring tool simply ignores the letters around the banned words. I was trying to work out what the missing, offending 4 letter word was!

Sorry another mistake - you are better off selling the rights if the you think the sp is going to be LOWER than 5.28 and better off buying if you think it will be higher. I think I need to take a break from the numbers for a bit!

Of course those numbers have continued to fall and it's now 5.23.