Member Info for Hexam

Tommy - Unless they can evidence it I suspect the 23rd is just a guess that's gained momentum. Personally I think it will be before that but that again is just a guess! Q3 was always the target so would be very surprised if it goes beyond that.

Sorry Big Blue but that's just plain wrong. The current value of the shares is 580 whether you exercise the options or not and if you buy the ones in the rights issue for 410p you are giving up the rights to sell them for 170p - so 580p again. The shares you already hold are also worth 580p - not 580 + 170. You can't make money from nothing but I'll give up trying to convince you - instead if you're not convinced yet you will be when it plays out as you're in for a nasty shock. Sorry.

Flower - I don't think the $18.40 is set - I think it is just the $ equivalent of the sp they quoted this morning - so just another holding/indicative number. I haven't got time now to read through it properly but it does seem clear the overall raise is going to be close to $150m i.e. in line with RNS this morning rather than earlier filings.

All sorts of numbers flying around but this is in the new F-1/A:

"We estimate that the net proceeds to us from this offering, after deducting the underwriting discounts and commissions and estimated offering expenses payable by us, to be approximately $124 million or $144 million if the underwriters exercise in full their option to purchase additional 1,125,000 ADSs, based on an assumed initial public offering price of $18.40 per ADS"

big blue - I'm afraid you're not currently up on EZJ if you sell the rights (can for about 165p currently). To make a profit the SP would need to go higher than the theoretical ex-rights price of 638p i.e. if you could sell the rights for over 228p. The pre-rights issue price was 789p not 700p.

maddmax - I'm afraid you are misunderstanding it. You are buying the new shares for 410p but you are giving up rights worth 170p. So it is the 580p current sp that is key and whether you think the future price will be above or below that.

P100 - "My holding has been reduced by the amount of the rights I am able to buy, therefore if I exercise them my holding will be the same as it was before, when all is said and done. How did you calculate that it will be current holding + rights take up?"

That's not quite true. Your number of shares have not been reduced, but you have the option to buy more and increase your investment. Some maths on the actual numbers may help.

Say you owned 470 shares. The price on which the discount was based (i.e. the previous close to the offer) was 789p so your shares were worth £3,708.

You can now buy 310 more shares at 410p i.e. for £1,271 giving you a total increased investment of £4,979.

The theoretical price post rights-issue is 4979 / (470 + 310) = 638p - which agrees with the number in the RNS. So in theory the RI should mean you go from 470 shares at 789p each to 780 shares at 638p each.

However, the price has fallen from the theoretical price to around 580p which means your actual shares are currently worth 780 x 580p = £4,524 assuming you take up the rights. As you can see this is much more than you had originally invested (as you have invested more) but not as much as it should be if market sentiment had been neutral. So at today's price you are down 4979 - 4524 = £455 but that is due to the market reaction to the RI not the RI itself.

Hope that's a little clearer? But maybe not???

ah - that makes sense. Thank you!

nothingforever - I do and that's what I'm saying. It's not a freebie.

The price is the same bargain whether it is £4.10, £2.10 or £6.10. We are simply buying £4.10 worth of shares for £4.10. Whether we do so depends on what we think EZJs prospects are going forward. I'm optimistic so have taken up the rights but that's just my view.

"Likewise for Easy, meaning a whopping 170p freebie with the rights."

What freebie? I can get that amount if I sell my rights but it's not free money in any way??

Agree though that this could maybe, just maybe, be the bottom for both IAG and EZJ.

There is 530PH due in Sep/Oct for machines that have already been paid for. A separate order was cancelled earlier this year.

Herdie - If there is a premium currently for buying a large number of shares then I wouldn't have thought it would be anywhere close to 10-20% - besides, is $1m-$2m really that big/unusual? We'll soon see anyway but I think it will either be at current market price or a bit lower but really happy to be proved wrong if we issue at a premium :-)

@600 - I get the attractiveness but if for example I was thinking of buying $1m of ARB shares why would I pay $2.20 say and possibly be locked in for 90 days when I can buy them for about $2 on the current open market and not be locked in? Especially as it seems it will be possible to convert shares purchased on OTC to ADS anyway.

@600 - I think you mean $100m. Though I don't believe there is any way that the price will be higher than the current sp as that makes no sense to me when they can buy now for that price (and not be locked in).

@PI100 - Agree with everything you say (and is very well put) except this bit:

"b) exercise the rights and add more shares (at a diluted price ex rights) which would bring your holding valuation to what it was before the rights offer (SP x number of shares)"

If you exercise the rights then it would bring your holding valuation to what it was before the rights offer PLUS the new amount you invest. This assumes that market sentiment has been neutral on the rights issue since announcement - which often it isn't (and in this case the price has so far dropped more than the discount implies).

Main bit is as you (and others) have said i.e. that the decision to take up the rights issue should depend on whether you feel EZJ will rise from it's current sp or not and whether you want to increase your exposure. If not that confident then can sell your rights and reduce your exposure (though as others have pointed out there is a third way that involves a bit more work that keeps your holding the same).

This may be a draft filing but it is also a prospectus for potential investors so should have every bit as much legal weight as an RNS - if not more.

It may be that the prospectus has already been updated but what we can see hasn't but I cannot see how the IPO can progress without the correct information to potential investors being given and this is not a small thing. Maybe there is a way that the two are consistent (other than a 50% discount) and I/we are just not seeing it in which case all well and good.

I agree with K3 that the RNS is unlikely to be wrong - as that would be quite alarming to say the least.

Either way it would be nice to get clarification on how much ARB are raising from this - personally I'd rather it was £100m than £50m in order to make a bigger dent in Texas/new machines after paying off the Galaxy loan.

K3 - relieved I’m not going mad but the latest filing was only 4 days ago so the inconsistency seems really strange.

To answer my own question - the numbers are consistent if there is a 50% discount - but surely not!?

What am I missing here?

I'm confused.

The latest filing clearly still states the maximum proposed offering is $75m but the RNS clearly states it is the equivalent of 75m ordinary shares i.e. about twice as much. Why do they differ and which is it? Are they raising £50m or £100m?