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Thronegames,
Essentially Article 10 is about how dividends should be taxed.
3. Notwithstanding the provisions of paragraph 2 of this Article, dividends
shall not be taxed in the Contracting State of which the company paying the dividends
is a resident if the beneficial owner of the dividends is a resident of the other
Contracting State and either:
(b) a pension scheme, provided that such dividends are not derived
from the carrying on of a business, directly or indirectly, by such pension
scheme.
If those numbers are true, that is a bit alarming.
HR,
I think you could be surprised.
A lot of income funds have this share and others will want/need it to given their prime objective is income. They won't take big disclosable, high profile, stakes but it will be in demand all the same.
Oh dear, there's always one. Lucy, I'll leave this one to you!
riskingit,
But the NAV is often determined by the discounted cashflow of the future rental flows. This is often higher than a stand alone valuation of a building used for a different purpose.
Thronegames,
That's an impossible question to answer. There is the theoretical/mathematical impact to the SP and then there is shareholder and/or market reaction which can go either way.
But generally the SP should fall to a level that balances the pre-rights value with the additional capital raised.
So let's say there are 1bn DEC shares and the SP is 125p. This means that the market cap is 1.25bn.
Let's say they want to raise £500m by giving shareholders the right to buy 1 new share at 100p for every 2 shares they already own. So that means 500m new shares issued at 100p.
Assuming all rights are taken up immediately then there are 1.5bn shares and a total value of 1.75bn, ie 116.67p per share.
This is the theoretical amount. So if you had 1000 shares originally (ie £1250) and paid £500 for 500 shares you would have 1500 shares worth £1750 (ie 1.1667p each) which equates to your original £1250 plus your extra amount of £500.
But the rights are not taken up immediately and can be traded independently before the rights date so this means there are 2 prices as soon as a share has gone ex-rights - the price of the existing shares and the price of the right to buy a new share at 100p. Again, in theory, the SP should fall to 116.67p and the Rights should be worth 16.67p. So you would have 1000 shares at the reduced SP of 116.67p, ie £1166.70 and 500 Rights at 16.67p each, ie £83.33. The sum of these 2 amounts is where you started, ie £1250.
So if you don't want to stump up another £500, you can sell your rights to someone else.
The beauty of a RI verses a placement is that the 'discount' goes to existing shareholders.
Compared to placing where new shareholders get shares on the cheap at the expense of existing shareholders.
All of the above is mathematical theory.
A well received rights issue (ie for an accretive acquisition or to firm up a dodgy balance sheet) may mean that the SP and rights values are more that the existing investment.
Equally a surprise RI or an overly ambitious acquisition could cause SP to fall more than it mathematically should.
IMO the company would need to flag up a RI well in advance with full reasoning so that it is well received and EXPECTED by the market.
Hope this makes sense to someone!
Mando,
Thanks. That's a very kind thing to say but everyone's decisions are their own. I post as I see it, rightly or wrongly. People shouldn't buy/sell purely based on my opinion but in hindsight I'm glad you stayed with it and made some profit!
We can argue both ways but as you say, let's wait and see. Only then will we know who was more right than the other.
Rusty has stated that he want a $2bn+ market cap within 12 months in order to do a US listing. Unless we get a re-rating up to about 175p, then fund raising is required. At current SP DEC would need to raise £400m+. This is a big fund raise so I would imagine a RI rather than placing.
adv11, thank you for your kind endorsement!
Obviously I could be wrong as we can all speculate. However, I will predict that the SP will be in the late 90s in a month's time, after the NAV update as of 30 Sept 2021. Let's see where we stand on 8th November to see who has the bragging rights!
I agree with Punter64 on 1 point, the Management are taking longer than they should in issuing the rebuttal. 2 weeks is plenty of time.
Punter64, I fear you have it wrong. The Management are working on the rebuttal and they do expect a bounce in the SP (possibly only modest towards 100p as opposed to the 120p prior to the short attack). I know someone who has been regularly meeting with CSH for a few years and are confident of a recovery, hence the value adding share buybacks. And no, the dividend is safe.
And when you say the SP continues to fall - not quite true. It is roughly unchanged over the last 5 days. It has found a floor.
Putting aside the 'Lucy' issue, I would have liked to have seen the full written rebuttal this week. The longer it takes the more concerning.
Lucy says
"As for why I'm on here... Well, you can think what you like, but I do what I do because I hate fraud. I come on these boards once in a while, when a short thesis in the UK tickles me. Then I try and persuade people of who the real bad guys are. And then i get bored of being accused of having ulterior motives, and I go back to work. It's a waste of my time, I know."
What a load of BS for someone who has only been a member for 2 weeks and only posted on this board. Your colleague was kicked off and you're trying to play the innocent using a female name. Shame on you. Have some guts and say who/what you really represent. You would get more respect even if people disagreed with you.
Lucy,
Just ask one of your ShadowFall colleagues. No wait, you already know the answer!
OMG, seriously!
adv11,
Yes, LUCY is definitely suspect here!