Understanding Rights Issue

[Paul Lee]

AusGroup?

I guess you have to wait for the OIS to be lodge with MAS on 23 Nov or wait for the hardcopy to be dispatched to you from 28 Nov for the detailed timetable.

Best guess: You may be able to press at the ATM form 28 Nov based on the announcement of the BCD.

 

[jx_yew]

Is it possible to sell your all rights (if it can be sold), and still apply for excess rights?

 

[Kinetic88]

Is it possible to sell your all rights (if it can be sold), and still apply for excess rights?

chiu can apply but chiu will never get !

chiu want to win on "head" and also want to win on "tail" ?

 

[K|muRa^84]

https://www.drwealth.com/what-is-a-rights-issue/

There must be something valuable about Blumont that shareholders are buying up the shares and the rights.

yikes.....

 

[XGZ1503]

Its kinda confusing... Renounceable can sell to other investors. Non-Renounceable (last sentence) can sell additional shares but sell to who? Under what circumstances?


"Renounceable rights will be listed on the SGX and shareholders can sell the rights to other investors. These rights will have a separate counter name. In Blumont’s case, they have Blumont R and Blumont R500 (in lots of 500 rights). Non-renounceable rights are not listed on the exchange and hence, these rights cannot be traded. The rights will be converted to ordinary shares and deposited in the CDP account after a certain date if the shareholder subscribes to the issue. Thereafter, the shareholder can choose to sell the additional shares."

 

[Paul Lee]

Its kinda confusing... Renounceable can sell to other investors. Non-Renounceable (last sentence) can sell additional shares but sell to who? Under what circumstances?

Regardless of whether the rights or PO is renounceable or non-renounceable, once you subscribe to your rights, it will be converted to the mother share and credited into your CDP account.

But only if you subscribe.

If you do not want to subscribe, in the case of renounceable rights, you can sell it away. In the case of non-renounceable, it will expire worthless. That's the key difference.

 

[Perisher]

To make selling rights clearer, here's my understanding.
When selling rights, like the current CSE Global rights, sell at prevailing market price, which is 9vqr at $0.009.

CSE Global prices it's rights issue is at $0.33
https://sg.finance.yahoo.com/news/cse-global-announces-33-4-025523110.html
When you sell, you sell the rights to the right.
Meaning the person buying from you still need to pay $0.33(for converting each right to shares) on top of paying that current rights issue price in the market at $0.009 per right.

While you pay nothing, subscribe nothing and merely selling away the rights(of converting each rights to shares).

E.g.
if i have 5000 shares of CSE global, i'm given 1000 shares(rights).
If i want those 1000 shares(rights) to be converted to real CSE global shares, i need to pay $0.33/share(rights) or $330.
If I don't want to convert, I can sell those 1000 shares(rights) on the market at prevailing price, right now for 9vqr, which is $0.009. And thus get back $9.

The buyer of your rights, at $0.009, would still need to fork out $0.33 per rights to get the shares. The rights cost $0.33.
The buyer essentially pays a premium of $0.009 + $0.33 for getting the rights + converting the rights to shares, total cost = $0.339 per rights.

In other words, unless market price of CSE global shares are much higher than $0.33, it makes no sense to subscribe... essentially you can get the shares on the market for $0.33~ anyway.

Take note that if you do sell, there is brokerage fee involved and may make it a losing deal.
Example if I sell 1000 at 0.009 = $9 while i pay brokerage fee of $10-20...

In that case, you can just simply... do nothing. So nothing will happen to your original shares.