Smith (ds) Share Discussion Threads

[gettingrichslow] 08/6/2018 11:59

Ianood, 1. can u give me an example of a rights issue where the proceeds of the lapsed rights weren't returned to the shareholders? 2. Why would a heavily discounted RI be 'more tempting'? Try naming one advantage? It makes no difference at all.

[phillis] 08/6/2018 11:41

stop digging

[ianood] 08/6/2018 11:30

I agree that % holding in Co is unchanged if subscribed. However, it depends if you are a longer term investor or not. The decision, to my mind, is made easier when you know the numbers. In some cases the unsubscribed rights will be sold and value passed back to the shareholder (not all). A heavily discounted rights is more tempting to existing shareholders - take a look at Phoenix a similar discussion is currently taling place there with their previous recent rights issue being used as an example.

[gettingrichslow] 08/6/2018 09:37

ianood, tell me what difference that would make? The things you describe are just the factors that determine how much money the company is raising. The only choice the investor has to make is 'do I want to maintain my % holding in the expanded company - if so take up the rights' or 'do I want to just maintain my £ holding in the company - if so don't take up the rights' and just wait for the payment for the lapsed rights'. It's that simple but a lot of people don't get it.

[ianood] 08/6/2018 09:16

You need to know what the cost and terms of the rights are then you can work out the ex rights price and whether or not it is worth taking them up or not.

[gettingrichslow] 08/6/2018 09:12

Ali47fish, what advantage would it give? You're not buying the shares 'on the cheap'. If you were, who do you think is subsidising it?? Google 'how do rights issues work' and you will see what I mean. The reason the RI price is lower than the current share price is purely because if the share price drifted lower than the RI price then no-one would take up the offer. That is all. You are not getting them at some sort of 'bargain price'. That is why many people choose not to take up the offer!

[phillis] 08/6/2018 09:07

taking up your rights merely maintains your share of the new whole - irrespective of the price paid

[ali47fish] 08/6/2018 08:42

gettingrich-but the higher discount surely gives us an advantage as existing shareholders versus buying on the market - but what matters most is the company's potential to grow its earnings if it fully valued there might not be a chance that happening

[gettingrichslow] 08/6/2018 08:35

Dozey3 and Losos and others, I don't understand why you are referring to the size of the 'discount' as if it is a discount like you might find on a car or a holiday or a ton of peas. It isn't. It doesn't get you the shares cheaper! The rights you are given have a tradeable value equal to the difference between the post RI share price and the discounted price, so you are not getting the shares cheaper by buying into the RI...you are just putting more money into the company and expanding your holding.

[phillis] 07/6/2018 17:51

Rights coming, Shorters alert (delta hedging)

[ianood] 07/6/2018 09:19

How the hell can he comment until the terms of the rights are known! Empty vessels and all that!

[ali47fish] 07/6/2018 09:16

russ mould of IG bell said it is fully valued with noi suggestion as to what investors should do- no details of the discount and other details is unusual- any insights please

[losos] 06/6/2018 14:31

Phillis - Always the risk of a leak from the Spanish side haha.
Dozey3 - Well yes the RI has to be attractive to me (Which I hope it is) I had been contemplating adding to my holding of SMDS for some time but felt the price was high.

[phillis] 06/6/2018 12:18

still a little puzzled as to why a fully underwritten rights is announced with no details
were they perhaps hurried into an RNS perhaps because of a potential leak
( from the Spanish end?)
House brokers will have to work hard to keep the price up

[dozey3] 05/6/2018 13:40

Bit premature to decide to take-up before we have any idea what discount (if any) is involved. At least they have given plenty of warning so holders who will need to release funds from elsewhere can do so. Hope those companies who go for cosey discounted placings amongst directors and their cronies, disadvantaging their small shareholders, can see how it should be done.

[losos] 05/6/2018 09:50

churchtower - I also will be taking up rights in full. Price needs to fall well below the stamp duty and commission charges to make it worthwhile, it could happen but I prefer the 'safer' approach haha.

Bscuit there must be a'bouncy' switch in your mouse 'cos five messages all the same. Either that or you really wanted to make a point haha.

[bscuit] 04/6/2018 20:06

Ditto. Interesting thought is whether it will help protect from an International Paper bid following the Smurfit Kappa rebuff or are the businesses sufficiently different?

[bscuit] 04/6/2018 20:06

Ditto. Interesting thought is whether it will help protect from an International Paper bid following the Smurfit Kappa rebuff or are the businesses sufficiently different?

[bscuit] 04/6/2018 20:06

Ditto. Interesting thought is whether it will help protect from an International Paper bid following the Smurfit Kappa rebuff or are the businesses sufficiently different?

[bscuit] 04/6/2018 20:06

Ditto. Interesting thought is whether it will help protect from an International Paper bid following the Smurfit Kappa rebuff or are the businesses sufficiently different?

[bscuit] 04/6/2018 20:06

Ditto. Interesting thought is whether it will help protect from an International Paper bid following the Smurfit Kappa rebuff or are the businesses sufficiently different?

[suetballs] 04/6/2018 19:49

churchtower I totally agree and will be taking up my rights in full too.
Suet

[churchtower] 04/6/2018 19:09

Surprised at those who have exited at this stage. Shall continue to hold and take up rights in full. This Company in my view is an ideal longer term investment.