I don't think so. Record date for the issue is Monday, ie ownership must be registered by then. As trading is currently halted and as settlement for trades is two business days, entitlements will be as per the current register.
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Yes, that is how I understand it.
The whole deal is to raise capital and benefit existing shareholders (who have been through the ringer!). Not to let opportunists try and jump on at the 11th hour and make a 'quick buck' :eek2:
Note that it is an entitlement offer, ie based on number of shares held, not a Share Purchase Plan.
I sold all mine the day before this for $0.35. But I still hold a little bit in my daughter's account through Sharesies O_o they better allow take part
Although not sure I want to, don't like these guys much
Very interesting learning experience. I bought in to SKT about a month ago at 27c. Still feeling confident in the company but weary of confirmation bias. Fairly comfortable adding to my investment through this rights issue but this is new territory for me (very newbie investor).
Couple of thoughts from the presentation:
Broadband - Good idea. Trustpower and Contact have executed this well. Low margins but shown to reduce churn. Contact in the HY FY20 presentation stated 20000 customers and I think they launched broadband about 2.5-3 years ago.
Live Sport - Biggest risk here. How long till sport returns is a big risk. There is some interesting wording around the rights. Seems that some of the contracts aren't black and white over pro-rata payments if the sports are disrupted like they are currently. You would think Sky has reasonable bargaining power here although may have to pay money now in return for discounted future rights.
FY21 forecast - I am hoping they are very conservative here. Slightly concerning the continual degradation of ARPU although if they can keep subscribers increasing (albeit most likely lower value users) this should reduce this reduction.
By my calcs, would need to get share price back to 15.9c to break even at full 100% rights option and 15.4c for 120%. Seems reasonable no brainer to reduce loss, even if I sell some or all of them immediately after they are issued.
In the example you quoted, you bought "cum div" and it doesn't matter when registration occurs; the registrar will include your holding when determining who gets what dividend. It's all "automatic" these days but if by some mischance the transfer didn't get processed, you would claim the div from whoever you purchased the shares from. Not so in this instance when an entitlement date has been determined, ie Monday 25 May, trading is halted and settlement, ie registration takes place 2 days after purchase. Hope this helps.
Thanks, and sorry to everyone. I just love this forum, everyone is so helpful:t_up:.
Seems like Sky's capital raising & underwriting structure is working a treat!
We have posters here clamoring for 'cheap' shares being issued at 12c, and expecting in the post-issue market for the shares to trade at 15c to 20c.
A few observations:
1. The reason why the underwriters require such a heavily discounted and dilutionary manner is so that:
(i) existing shareholders are 'forced' to take up the issue or get diluted heavily, and
(ii) the underwriters will pick up shortfall stock at a very 'cheap' price with little downside.
2. There is a very good example to show what's likely to happen post the rights issue - Fletcher Forst (FFS).
FFS had to do a similar capital raising way back in 2000 (2:1 at 25c) after failing to find a buyer and after the banks pulled their funding support. Basically, it's a bailout.
SKT is doing exactly the same thing - it's clear no suitor has emerged to takeover the company and the banks want their money back.
In the case of FFS, the underwriters ended up with a big chunk of the capital-raising stock (>20%) at 25c.
They were happy to dish the stock out at 25.5c to 26c for months on end, taking their underwriting fees as well as the %tage gain from the market by selling out their underwritten shortfall stock.
FFS sp traded at 24c at times during that period as impatient traders bailed out on bad days.
So - my prediction is that, depending on what %tage of the stock the underwriters end up with, you will see SKT trading at just above 12c for a while.
KMD has doubled from placement price of only 50c.
Underwriters unlikely to get much stock. Only got 4% of issue currently. Most will take up their entitlement in full. Exlcluding perhaps Rugby NZ and RugbyPass shareholders.
Bank happy to lend more, now $200m + extended 1 year.
Doubt they will get more than $50m total. Approx 16% issue.
Conclusion. This is great entitlement offer if
A) You participate.
B) You got Sky shares relatively recently