Member Info for IgglyBiggly

Hi Wolfhound, thanks for the wise words. That about answers all of my questions on this. My concerns about pricing are because my portfolio is already heavy in OPAY. By having to pay out nearly 50% more (of the current investment) I will be over weighted in this share and so at some point soon I will need to reduce that. It is therefore about selecting the best moment to action that reduction. It is all well and good saying this will really take off, and I am with you on that, but from a risk point of view I have to reduce my holding sooner (after May 5th) rather than later. Remember recently the £5.30 to £3.20 drop? These little surprises can come from anywhere. Kind Regards Iggly.

@wolfhound - do you think that the new "lower" price (for currently owned shares) will therefore kick in on Apr 15th and not the 17th? I ask because if the record date is the 14th and the lower price did not kick in on that date, then you could sell your existing shares at the higher price on the 15th, qualify for the rights and buy them, then trade these from the 5th May. It is not what I plan to do, but is one of the last unanswered questions I have. Also, there is quite a variance on what the "new lower price" is going to be, with estimates in previous posts from £3.19 to £4.19. It would be good to get this pinned down to a closer range.

It's £1.66 per share not £1.67 and the new shares in issue will be 472,567,936 after the Skrill consideration shares. The prospectus says this on page 48:- RIGHTS ISSUE AND ACQUISITION STATISTICS Offer Price per New Ordinary Share 166 pence Basis of Rights Issue 5 New Ordinary Shares for every 3 Existing Ordinary Shares Number of Existing Ordinary Shares in issue(1) 163,153,081 Number of New Ordinary Shares to be issued pursuant to the Rights Issue 271,921,802 Aggregate number of Ordinary Shares, admitted to trading on AIM upon Rights Issue Admission(2) 435,074,883 New Ordinary Shares as a percentage of the Enlarged Share Capital of the Company following completion of the Rights Issue 62.5 per cent. Estimated gross proceeds of the Rights Issue £451 million Estimated expenses of the Rights Issue and the Acquisition(2) £45 million Estimated net proceeds receivable by the Company after deduction of the expenses of the Rights Issue and the Acquisition £406 million Number of Skrill Consideration Shares to be issued pursuant to the Acquisition 37,493,053 Aggregate number of Ordinary Shares to be re-admitted to trading on AIM upon Completion(2) 472,567,936 Notes: (1) As at the Latest Practicable Date. (2) Assuming no Ordinary Shares are issued under the Optimal Payments Employee Share Plans. (3) Total estimated expenses split as follows: Rights Issue: £18.4 million and Acquisition: £26.7 million.

Chris Hi, you are right, sorry must get new glasses! The proposal document says "Joel Leonoff intends to sell 2,025,751 of his Nil Paid Rights during the nil paid dealing period to partially meet the costs of taking up the balance of his entitlements to New Ordinary Shares (being 2,363,987 New Ordinary Shares)."

Ok Thanks Wolfhound, I see that and your maths works for me. It doesn't look quite as good as that if the current price is maintained (at £5.65 instead of £7). My theory worked around the fact that on the 17th you can sell your existing shares and still retain the right to buy the new shares, because the record date is the 14th April. However, I think what we are saying is that on the 17th, the market price of shares will be at the new level of £3 something - is that right on both the date and the SP drop? I am trying to forsee what is likely to happen so there are no shocks.

I looked at it this way, using numbers we have worked on before.. If you had 999 shares you bought at (say) £3.50 (use your own numbers) they cost £3,496.50... Today at £5.65 they would be worth £5644.35 (+61%) On 14th April you would qualify to buy 333 x 5 = 1665 nil paid shares which will cost £1.66 each (£2763.90). On 17th April 8am, you would have.. 999 shares at £3.50 cost - (which you want to be up at current levels or above but probably won't be) 1665 shares at £1.66 cost (which you might buy and they might double in value on the 5th May) to say £3.19 If you wait until 5th May (and lets say the price was £3.19), you will lose a lot on your current holding, but make that up by the gain on the new shares you bought at £1.66. BUT, If you (could) sell the existing shares for a good profit on the 17th, you would still have the rights to buy the 1665 at £1.66 (and the funds to pay for them) .. BUT if everyone is running to sell on the 17th April, then the price will open down a long way. The closing price on the 14th is also key to all of this. I see Mr Leonoff is planning to sell £2m shares to pay for his new rights, so I see this as following this logic. Is this scenario logical?

In your HL account (or for anyone else your usual online broker account), on the 17th April, should appear a new line of shares which will be your "nil paid rights" shares. You will have the option through complete the purchase and pay for them or sell the rights to someone else. Since these are cost £1.66, the price will not be anything like we are seeing now. It could be at a slight premium to £1.66 or slightly less (as the saying goes). Oh - It has just occurred to me - the 17th April is a crucial date for the existing shares we own. It's going to be a huge drop in price surely as everyone sells the current shares they own (isn't it?).

Or on 999 shares (which are divisible by 3 exactly - you won't get rights on fractions of shares) ... The right will be: 999 shares / 3 = 333 x 5 = 1665 nil paid shares, which will cost £1.66 each = £2,763.90 However, having looked through the prospectus (all 500 pages!) I note that.. The register date is 14th April 5pm, so you can trade your (existing) shares from 17th April to fund any purchase The Nil Paid shares - I think you can trade those from 17th - will they be quoted separately on the market? (until 1st May) The shares combine (if you have paid for the nil paid shares) and become fully paid which will trade from 5th May Please note this is just what I am picking out of the prospectus and i could be wrong!

I have been trying to do some numbers to ascertain the "new world" price. A lot depends on the OPAY SP at the close of business the day before the new world (I suppose), but based on today's closing price of £5.72 I get this:- Current OPAY Shares in issue 163,153,081 at £5.72 = £933,235,623 Company Value Buying Skrill for £800,000,000 (ish) Combined company value = £1,733,235,623 Total Shares in issue = 472,567,936 Value Per Share = £3.67 (roughly) (if the new world started tomorrow) Are these numbers right anyone? If the OPAY SP went to £6, then the new world price would be £3.76 (roughly) If the OPAY SP went to £7, then the new world price would be £4.11 (roughly) This of course takes no account of the value of FTSE250 entry. Or am I missing something?

Hi, I can't access that PDF at the moment, would you be kind enough to post here the thoughts on Ex Rights price/value please.

Yes, I understand it is an option Chris, but IF you want to take the option then that is the financial implication. So in the question posed below by "sharesplease" he asks "Does this mean, if I buy a share today at £5.34, i will get to buy another share for £1.66 at the end of April, I would then have 2 shares at £3.50 each ???". It would be more relevant to ask - If I buy 3 shares today at £5.34, i will get to buy another 5 shares for £1.66 each at the end of April, I would then have 8 shares at £3.04 each (£24.32). Is that the right interpretation?

It is yes, but you need to understand the financial implication. For every 3 you have (at say £5.50 now) = £16.50, you will probably to commit to buying 5 at £1.66 = £8.30. So you will have to find another (almost) 50% in funds on top. Just bear that in mind. For those that don't have 50% of their investment lying around spare, they will probably have to sell around 40% of their holding to generate the cash to buy the 5 shares for every 3. Please feel free to correct me if I am wrong. But that is the approximate maths I have been working on this morning as a worst case scenario.

Thanks Smiley. That clears that up. No, I am not mindful to sell, I am mindful about the cash I have to find to pay the £1.67 to get the 5 additional (for every 3). If I am right, I have to find an additional 40% of my investment value on top? That is a tidy sum to raise!

3 simple questions from a simple investor! Am I getting more shares (5 for 3) or staying with the same number of shares. When is trading likely to be back up? tomorrow? Is there any argument to say the price is likely to fall dramatically?