Member Info for tichtich

I'm not sure I understand the timing. Would it be correct to say that shareholders can exercise their rights (and pay for their new shares) any time from 8th July until 22nd July, and they will receive their new shares immediately or soon after paying? So some people will have new shares to trade as soon as new shares are admitted to the stock exchange (on the 8th), but other people can continue exercising their rights up until the 22nd?

Interesting point, driftking27. If the company had been paying out smaller dividends and saving the cash instead, then maybe they wouldn't have needed to ask us for cash in a rights issue. Effectively a rights issue is a reverse dividend payment. Instead of the company paying money out to us, we're expected to pay money into the company. Did it make sense for the company to pay us out money (as dividends) over a few years and then ask for it back again? Well, maybe yes. If they didn't know whether and when such an acquisition opportunity would arise, it might make more sense to let us have the cash to invest elsewhere rather than keeping it sitting around in the company until it's needed.

@Theanalyzer

Ah, I forgot that there could be an opportunity to sell my rights. If so, it would probably have been simpler than selling shares to pay for the new ones.

I haven't participated in a rights issue before. As I understand it, we will have the right to buy 10 new shares for each existing 19 shares, at a price of 176p per share, on 22 July. I don't know the exact mechanism, though. I guess our investment platforms (Interactive Investor in my case) will have a special action we can use to buy the shares.

As I see it, you should definitely buy all the shares you're entitled to, as they are well below market price. In effect, if you don't fully participate, your existing position will be diluted by the sale of cheap shares to those who do participate. I have just sold some CSN shares to raise the cash to pay for the new shares.

Nice, but it's a lot of extra money, which would break my rule of not having more than 10% of my investments in one company. Plus, freeing up that much cash is a bit awkward right now. So I might just sell some existing CSN shares to pay for the new ones. It depends what price I can get. Will the price drop when the market opens?

P.S. I just noticed Riscoff's point that they might be able to transfer the debt (to purchasers of the properties). That hadn't occurred to me. Let's hope they can do so, and get some consideration for that in the price. But I doubt they have a contractual right to transfer the debt. And if it's at the discretion of the lenders, why would the lenders agree? I assume the lenders would be happy to get out of such low interest loans, now that interest rates are much higher.

Agree, but I'm still disappointed that they're winding down. I'd rather keep receiving the dividends. Given that dividends are so well covered now, from here they should be able to achieve their original goal of paying a dividend linked to inflation. It's particularly annoying that they are going to repay their very cheap, very long term debt. Cheap debt is a valuable asset!

I actually sold some shares (especially in the US) before Libation day, as I was expecting some Trumpian chaos. So I had some cash. I wasn't fearing lower prices. I was hoping for them! 😉 I still have most of that cash, so I would welcome another fall. (Sorry!)

CREI was near the top of my shopping list, as it seemed cheap even before Libation day. Most things on my shopping list are up 15-20% since then. But CREI is up the most.

Doing nicely. I'm just kicking myself for not doubling my position after Libation Day, which I almost did, but decided to hold fire and wait for an even better opportunity. Now I doubt I'll get a better opportunity than that. I think CREI is up about 25% since then. Oh well, it wasn't my first investment mistake and I'm sure it won't be my last. 😎

By the way, I find it very hard to invest in something that has gone up significantly from its low point. I always hope that it's going to go back down again. Then I end up missing a good opportunity! So my first thought today was that I wasn't going to buy more ENRG at this higher price. I think it's up about 25% from the low point. But it's still on a discount of about 37% by my calculation, so I guess I should consider it. Thanks for the idea.

I first bought SEIT at 56p, and I've been adding on the way down. I wish I'd added to ENRG on the way down too. I did better with RESI, adding a lot near the low. (That one seemed very safe at the low.) I wasn't aware of VIP. I'll take a look.

I have quite a bit of cash at the moment, as I sold some positions (particularly in the USA) in the weeks leading up to Libation Day. I was expecting some Trumpian chaos. Unfortunately, I didn't take much advantage of the tariff crash, as I was hoping for even lower lows. Now I'm beginning to wish I'd bought then, and I'm reluctant to deploy cash now, at 15% higher prices for most things. SEIT is one of the few things that hasn't recovered, so I've already added more of that.

Oh dear... yet another of my infrastructure funds (and a REIT) winding up! I'd much rather have the long term income for retirement. Still, I suppose it depends on whether there are still some good value dividend payers left to buy when we get our cash. REITs have much reduced their discounts recently, and the main infrastructure trusts remaining with high discounts seem to be funds like UKW and BSIF which are dependent on UK energy prices, and I don't want any more exposure to those because of uncertainty over what the new pricing system will be when HM Gov gets round to changing it. That leaves SEIT, which I already have plenty of, but maybe I can add a little more. And I'm thinking of buying some INPP if the price comes down a little more. Any other ideas?

I wouldn't give much credence to the Motley Fool free blog. Not worth the electrons it's written on, in my opinion. It's a very different beast from their paid service.

Even if this US administration's economic policies are broadly good ones in principle (which I doubt, but I'm not an economist), it must be a massive headwind to have them executed by such a lawless, lying, chaotic, ignorant president and his sycophantic cronies. And even if they are successful, is it worth sacrificing democracy, rule of by law, respect for truth, tolerance and decency on the altar of a better economy? As far as I'm concerned, the answer is a resounding No.

Markets seem to be bouncing on news that some big investors have begged Trump to pause the tariffs for 90 days. Am I being too cynical in thinking that they just want a chance to get out of the market at a better price? 😄

I'm still waiting for a better buying opportunity (not necessarily in LGEN).

Thedetector: "On occasion we have to agree to disagree."

The facts on this particular point are crystal clear. I gave you a link to the evidence. There is no more room for disagreement on this than there is on whether the Earth is round or flat. Since you apparently have no interest in the truth, I'm filtering you out.

Oops... "disrupted" --> "disputed", and the link should be https://benansell.substack.com/p/simple

@Thedetector

"No one anywhere has disputed his figures."

What's been disrupted (in many places) is Trump's claim about how the figures were calculated. Here's what I wrote on another LSE board...

We know exactly what formula was used to calculate the tariffs, because the White House revealed it. And the formula takes no notice at all of any existing tariffs or other barriers to trade. It is purely a function of the US trade deficit with that country. Higher deficit means higher Trump tariff, regardless of whether that country has any tariffs or other barriers on the US. That's why some extremely poor countries, like Madagascar and Lesotho, have some of the highest Trump tariffs. They're so poor they can't afford to buy American goods.

See https://benansell.substack.com/p/simple where I've left a comment under the name Richard W.

@Couerdelion

Let's hope that those who find out they've been fooled by Trump's lies about the tariff rates will think twice before believing him next time.

The scenario I worry about is that the government decides on a policy of "financial repression": high inflation to inflate away the national debt, while holding down interest rates by forcing financial institutions to buy low-yield gilts. That wouldn't be good for LGEN.