Note the mkt cap of the rights now $965m plus AIR at $1045 = $2010m. To make it apple with apples with old price divide value by nos of old shares, ie 2010/1122 = $1.79. Increase from Friday 179/127.5 = 40%.
Did I miss the takeover offer?
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Note the mkt cap of the rights now $965m plus AIR at $1045 = $2010m. To make it apple with apples with old price divide value by nos of old shares, ie 2010/1122 = $1.79. Increase from Friday 179/127.5 = 40%.
Did I miss the takeover offer?
The AIRRG shares are offered around the 79 Cents. If you buy 10,000 of them, you can buy 20,000 shares of AIR after 26 April at 53 Cents each.
Can someone else cast their eyes over the listing rule below. It would seem to me that AIR released the notice on the 31st Thursday, went ex on Monday 4th. There is 1 business day between. Where are the 4 clear business days? That time is meant to be there to allow the rights issue to be understood.
Rule 4.17.6 For an application to NZX for Quotation of Rights under a Rights issue of Equity Securities, notice in a manner and form required NZX must be completed and supplied to NZX through MAP including any QRP notice(unless the QFP has already been released through MAP). If such Quotation is granted:
(a)such notice must be released through MAP no later than 5 Business Days before the Ex Date for the Rights Issue,
It's not just these 'sharesies people'' and mum and dads' - instos and sophisticated investors piling in as well - Kiwi and Aussie ones as well
Bright things ahead for AIR - so many can't be wrong
Them Head shares may well be back up to circa $1.53 in no time, the way things are going.. ;)
Let's not worry about hard to understand fundamentals, lack of a dividend for yonks or the ship
belching out more red ink than all the South Island meatworks (No one really wants to
even understand or know about the extent of Red, when Uncla Grant is smiling at the job)
I see you have applied the "duck test" lol https://en.wikipedia.org/wiki/Duck_t...ears%20to%20be.
They got a waiver: https://www.nzx.com/announcements/389771
Hi dassets and nztx...a quick line from your favourite Shareholders' Association :-)!
It looks like AIR were granted a waiver by NZ RegCo in relation to the 5 days.
Waivers from Listing Rules 4.17.6(a), 5.1 and 5.2 - NZX, New Zealand’s Exchange
See below:
Waiver from Listing Rule 4.17.6(a)Decision4. Subject to the conditions set out in paragraph 5 below, and on the basis that the information provided by AIR is complete and accurate in all material respects, NZX Regulation Limited (NZ RegCo) grants AIR a waiver from NZX Listing Rule (Rule) 4.17.6(a) to the extent this Rule would otherwise require the notice required under Rule 4.17.6(a) to be be released through MAP no later than five Business Days before the Ex Date for the Rights Issue.
Also, note that the 'record date' for the rights is actually tonight - but with T+2 settlement, in effect, was Friday Apr 1st. With the offer announcement on March 30th, they have essentially had 4 business days.
Apologies if this has already been shared.
"Here's the quickest way to achieve efficiency in our skies - stop bailing out the national carrier."
https://www.stuff.co.nz/opinion/1282...ir-new-zealand
To Clarify on your post (19714) above Oliver,
The announcement was Wednesday 30th/March, ex date Monday 4th/April. So AIR have given '2' clear business days before the Ex date, nowhere near 5 business days. Yes they have a NZX Regco waiver but it seems a little conflicted here or at least that multiple parties have come up short.
Investment Bankers announcing a deal without clearly explaining mechanics to market participants, NZX mispricing the reference price from an Ex Rights perspective, NZX agreeing to a waiver which hasn't helped investors, FMA signing off on documentation that has ultimately confused multiple investors including market professionals.
Even the experts got it wrong https://craigsip.com/insights/overvi...2-005056813337
Excerpt "Importantly, if you buy one of the rights on market, you don't yet own one of the new Air New Zealand shares. You'll have simply bought the right to buy one for $0.53".
Actually one right gives you the right to buy two shares at 53 cent price.
What a mutt's breakfast.
Disc: Beagles do not normally eat out of other mutts dog bowls.
Two rights granted (each to One new 53c share) for each existing AIR share would have saved a lot of the shambles we see ;)
Thanks for look into this - Oliver :)
Theses.
1. AIR will benefit from NZ opening up again beyond expectations.
2. Buying AIR comes with an entitlement to something for nothing (cheap shares).
3. AIR is well-run, state-backed and is a "masthead" investment.
The Hog's thesis.
1. Those who are not out of AIR already want to sell their bags. What better way than to talk it up, suggesting investors will get a free lunch.
Hi ordop...the record date is actually tonight (Apr 5th) at 7pm. But because it takes 2 days to settle a transaction, the 'effective' ex date was Friday Apr 1st. Not sure where you are getting Apr 4th from, although that was the date the rights started trading.
This from the Air NZ offer doc:
30 March 2022 - Announcement of the Offer
4 April 2022 - Rights trading opens Rights trading commences on the NZX Main Board.
7.00pm (NZST) / 5.00pm (AEST) on 5 April 2022 - Record Date The date for determining entitlements of Eligible Shareholders.
6 April 2022 - Opening Date for the Offer Offer Document and Acceptance Forms despatched to Eligible Shareholders.Rights Offer opens
I think all this highlights that the offer IS complex...we'd advocate for all investors (newbies or experienced) to read up on the offer fully before trading in either the rights or the shares.
NZSA is concerned at the confusion - the offer is well-outlined in the AIR material, but appears to have been interpreted differently by many (including the NZX). NZ RegCo, unusually, has been REALLY explicit about the theoretical prices for both the rights and the head share. I've been quoted in Stuff as well: NZX error results in trading halt on Air NZ rights, wrong price for rights and shares showing | Stuff.co.nz
"The confusion on the NZX this morning doesn't help matters in terms of conveying a clear, consistent and simple message about what the offer is worth for those investors," Mander said. And there's some good commentary in Business Desk from Craig's who are now saying that "We remain perplexed by the trading in AIR with the share price seemingly disconnected from fundamentals..."
Please - take the time to read the offer document carefully before trading in the shares or the rights. We're really concerned that there's a whole lot of investors (newbie or experienced alike) who may not fully understand it.
Hi Oliver, sorry but I will clarify what I meant by your original post. The waiver you refer to above states the announcement release should be no later than 5 business days before the Ex Date for the rights issue. You then mention they have essentially had 4 business days. This is Incorrect. AIR released the news only 2 business days (Thursday and Friday) before AIR went Ex rights on Monday morning. The first day of trading Ex Rights! This is the most important date (the Ex Date) as it tells the investor whether what they are buying is Cum Rights or Ex Rights. The registry looks after everything on the Record date and the brokers 'protect' anything unsettled.
For further clarification, have a chat with Blackcap who can give you a heads up on this.
But yes this issue has been a complete cluster. By the Way, I would get the STUFF article to change your quote about a pronounceable issue!
All the Best.
Maybe it's not just that it's complex, but that 2-for-1 is too simple. If they had made it, say, 7-for-4, the dopes at NZX and non-comprehending investors would have realised they didn't fully understand it.
Ex vs record date...got it. On that score, quite correct ordop. And yes, the ex date is indeed Apr 4th when the rights trading began (I read ex for record).
The last thing I want to do is add to the confusion! As you say, though, doesn't change the underlying concern that it has confused many people.
Average trade today was 1,009 shares.
Plenty of small investors trading, average value $950.
Sorry been tied up. They had waivers, a lot of them, including the timeline.
The rationale is disclosed. However it is clear the rational failed to consider factors that should have been addressed such as magnitude, relative complexity and an inexperienced shareholder base. I think that will be the approach I will be taking , that the waivers esp re time lines should never have been given.
EDIT Just saw the reference to waivers above. But reiterate one of the reasons for the gap is to let people sort everything out and that clearly didn't happen. Basically AIR didn't have its arguments put forward challenged. The rules were merely pushed aside to suit them. The main reason they were scared about a lock down
AIR announces opening of Rights Issue
https://www.nzx.com/announcements/390134
Yes about the same current price of AIR shares :). I assume both of AIR and AIRRG prices will be traded proportionally the same.
Good 'explainer' and more commentary on the complexity from Stuff.
Air New Zealand's rights issue opens on Wednesday. What do shareholders need to do? | Stuff.co.nz
Except for getting the reference price for AIRRG wrong. Just goes how to show what a shambles this is.
Oliver if you are going to raise this with FMA or NZX I can provide some thoughts that might be relevant. I have used to do a lot with corporate actions doing one thing or another.
It's academic, but the article is wrong that, "on Monday the reference price for Air New Zealand shares was 77.5c, as set by the airline in association with its bankers."
77.5c is a theoretical calculation that anyone could do. It was ultimately based on the last pre-rights trading price of $1.265 at 5pm Friday. It was also based on the terms of the offer, which was what the airline and its bankers did decide, but had been known for 2 days. Ultimately, the market decided on $1.265, which determined the 77.5c, not the airline.
Sharesies users account for 2.5million shares traded yesterday (buy and sell). Who knows how many the day before at even higher prices. Looks like reality is really setting in and funds are taking the chance to sell down at these elevated prices. Will be interesting to see how if Sharesies users become net sellers as the price starts dropping?
The rights are leading the ords down currently. I wonder if any holders are putting on risk-free arbitrages by selling ords and buying rights.
Agree with the comments on the reference price - difficult for journos to understand down the phone sometimes. I said that the77.5 was the TERP as issued by NZX on Monday morning.
But in general, I think John Anthony's done a good job trying to make it as understandable as possible.
Funnily enough, even though AIR is currently 0.84 and AIRRG is 0.50 (yes there is an arb there) the aggregated price of $1.34 is still higher than the last traded cum price from Friday at $1.265. All the action at this point in time today is just wiping the ridiculous price action of Monday and Tuesday.
Its actually all very simple and just highlights the appalling lack of financial literacy in New Zealand.
The only criticism I'd have is that one share should've just equalled 2 rights with each right to buy one more share. That has been the structure of pretty much every major rights issue in NZ for decades.
Sky TV 2.83:1, Fletcher Forests 2:1, Nuplex I think was 3:1
Brace, brace.....
Heads down $0.10 to $0.85 and rights down 24c to 51c.
Buy the rights and the 2 shares, and means 77.5cps.
Obvious arbitrage opportunity for those that believe the shares are worth 77.5 cps. Bit like saying ARV are worth $2.60. Just fantasy land stuff...
U can sell the AIR thru CFD and buy the rights ...45 cents + 106 = 151 for 2 shares of AIR ...selling at 83 cents ...cool 10% arbitrage
Yes that's exactly it .. looks like a bit of horse trading in AIR rights taking place on Sharesies too :)
Do I see upside with this one once the dust clears or heavy storm clouds on the horizon for years to come ? :)
NZX looks down as a whole today.. lots of Red .. a few more days of the same will do what for AIR ?
Perhaps a further reduction in part or whole as today, as reality sinks in out there on how
much or little has changed to the nature of the beast ? ;)
No matter how much the thing is painted up, bound to be lots of further AIR Red and Cash
burn going forward IMO ..
As for re-establishing former routes, service and capacity to former levels - what will that require and
where's it coming from ? ;)
By giving rights at very attractive price of 53 Cents will make sure AIR issue will be oversubscribed ...so propping efforts of underwriters will be minimal ...just lip service and good press will do
Might be the case my friend - but what are you buying & for what purposes ?
Forget dividend income for years - the thing is it's going to be coughing & spluttering away
for some time into the future.
For some - 'I own a part of AIR & got them dirt cheap" might be enough .. but how long until
the Dirt Cheap buy cost starts looking like a bargain buy worth the journey ? ;)
Sooner or later an inevitable Share Consolidation is bound to wipe the smiles off many faces.
If that didn't happen what would a potential small dividend per share look like on
the enlarged capital needed to bail AIR out of today's tight spot ? ;)
5-10 year wait anyone ? ;)
More Virus, different virus or worse strains possible ?
More global turbulence ?
Lots of risks in Joe Retail Investors camp and they're not small - all with potential to put the Retail Investor out of any money ahead well into the Red .. or further out the back door for those with higher ingoing cost :)
Is Joe Retail Investor being taken for a long potentially hazardous ride that they didn't realise ? ;)
Of course indirectly the 51% major holder is really in charge of navigating where the broomstick is headed
- make no mistake about that ;)
And a final point -- I guess everyone here will be eagerly waiting in the queue to jump on the next
AIR flights to go all over the place again, as if nothing has just happened .. or maybe not ? ;)
Look no further than Retailers in some of our cities to see how they're currently faring,
confronted with a perfect storm of a multitude of simultaneous hindrances & disruptions .. :)
Will AIR be any different or kneecapped by the same perfect storm for a long time ahead ?
I'm picking that both AIR & Retail will have some time going forwards before customers
feel even slightly comfortable returning to a shadow of what was before Covid.. :)
When they run out of money again next I wonder what the novel ingenious plan will be.
"novel ingenious plan will be"
another cap raise...
if it works once....
We're going to revive and thrive and we really mean it this time. Marketing punch line for the next capital raise.
"If it worked twice…"
stand corrected!!
yes !
deleted - I should not reply to old posts without prior checking whether others have not already done that ...
Post Cap Raise a truck load of shares will hit the market for sale, those that are placing their bets that their cost averaged price, inclusive of the 2 shares at 0.53, will be lower than where the market stabilises and SP settles in at. Unfortunately some who are counting on a quick profit might be rudely awakened and find out their coast average price is significantly higher than where SP stabilises. In turn a heck load of shares sitting to be offloaded with traders who bet the wrong way cutting their losses, hitting their stop loss, and the vicious cycle of post CR pulling SP down to potentially even lower than the offer 0.53. We have seen it many times before with large Cap Raises. Just take a look how they have played out with some of the recent ones. HUGE gamble those that are counting on SP rallying post CR. Regardless on if oversubscribed or not, there will be a large percentage of people looking for an SP post Cap of 0.8 plus and hoping to sell out making a quick 10-20% profit off their cost average price. For that to work their cost average AIR shares would need to be no more than 0.60c. There will be a lot of investors who's cost average price is nothing like $0.60. If their cost average price is more like 0.7- 0.8 (for those that were buying in AIR last week at 1.15 or higher), even factoring in the 2 shares @ 0.53 it doesn't help. With the cost average sitting at for example 0.75 then to make their 10-20% the SP would need to stabilise at 0.90 Which I think all can agree is not going to happen. Once the reality of this settles in many will realise their bets turned bad and they hold 3 times the amount of AIR shares which wouldn't have provided any quick profit. Shares will flood onto market trying to minimise losses or break even at best in turn putting further downwards pressure on the SP.
SP has a long way to fall yet. Wont reach it's lows until post Cap Raise once offload of shares commences. Possibly for a lucky few at a small gain if somehow they have a low enough Cost Average, but for most very quickly tides will turn on the sell off, buyers will dry up due to the fact most would have already purchased in the massive Cap Raise. Sell volumes will swell onto market depth. SP will only have one direction to head.
And all said above isn't even factoring in the difficulties the company itself faces. Combined with Zero dividends. How on earth is that looked at as a stable or sound investment.
It was a smart way to 'extort' money out of exisiting share holders (trying to minimise losses due to dilution) and encourage new unsavy investors to jump in and take 'advantage of the low CR offer. The positive is at least it gives our National Airline some breathing room and dig its way out of their current debt. However they aren't a charity! Not a wise investment move, or trading play even with share price allocation of 0.53.
Once people see the SP stall post Cap Raise after an initial short minor rally off the back of an over-prescribed 0.53 offer, volumes will flood onto the sell side and SP will downtrend. Analysts suggesting 0.6- 0.64. In reality history would suggest we will actually see a downtrend in SP back to more like around the SP offer of 0.53. Let's check in and see how accurate this post is to follow, 1 month post CR allocation. Anyone keen to put forth their target SP?
0.51- 0.56
It's going to be interesting to see what the post Cap Raising Party auction of the plates left over
on the AIR table comes in at - any guesses ?
Given AIR rights aren't being traded on ASX - the decisions there must be to take up or not :)
I reckon 0.63-0.65 Fingers crossed
Agree. RAD, PEB same trend off Cap Raise. Until a company can fundamentally show something solid and positive solid off a large Cap Raise the SP can only decline to the CR offer or lower. AIR will be no different. Quite amazing how many punters are out there that don't seem to bother doing their homework.
I sold out of AIR on 7 Feb 20 for $2.835. Since then I have watched it go down but it stayed over $1 which amazed me as with no flying, no income etc the price should of been under $1 with even a 40-50c price in the last 2 years. The patriotism this company has is huge and there is nothing more proud of seeing the big Tail Koru when you walk into an overseas terminal. We all knew a CR was coming so at what price should Air be now. At one AIRGA (0.48c) you can buy 2 x shares at 53c = $1.54/2 so those 2 shares will cost me $0.77 compared to todays market price of 84c. But I think the Rights will sell off and go lower as entitled holders who may not want to buy into the new shares sell off and the rights price could drop a lot closer to ex date. So if rights dropped to 10c plus your $1.06 = 58c per share which is good discount vs todays market price. However, the main shareprice could also fall to its take up offer price of 53c.
So what will be the best action to take. For me, I am going to wait until after CR date and see what the price is then which I think will be somewhere 53-58c. If it then drifts down into the 40's then I will look to take a new long term stake.
Predicting future share price bottoms is like predicting your future based on a newspaper horoscope. Sometimes entertaining, however there is no correlation at all between prediction and outcome.
Sure - the AIR shares might bottom out around the magic 53 cents, but then - they might not. The odds are clearly stacked against this option.
They might bottom out around half of that ... but hey - who knows. I don't think it is sensible to set in the current situation any buy in prices ... just wait for the game to play out and buy if and when the technical indicators start to look friendlier. I am thinking something like confirmed break through the MA100 plus supporting fundamentals (which look terrible at current).
At this stage we don't even know, whether this is the last CR before the recovery ...
So many other opportunities to park ones money ...
Radius Healthcare shares were about 170 once. Drifted down and settled around 90/100 mark for a period. Radius needed some cash so had a capital raise with new shares at 52 .... punters scrambled to get their hands on them .... cheap, huge discount etc etc
Share price went down to the 60s and then the 50s and then the 40s and now in the 30s heading to the 20s
Maybe AIR share price will head down to 60's and then the 50's and then the 40s and then the 30's and maybe the 20s as well
last time I sold AIR shares I got $3.27 for them
"maybe the 20s as well"
NAH the SHAZ will make sure of that... maybe go without bread that week... ARHH KFC ...
AIRRH and then AIRRI
Edit in response to earlier question wondering what air plan is once they run out of money again
"air plan "
since dassets seems to have some knowledge of planes and things?
what are AIR's options....
https://en.wikipedia.org/wiki/Dassault_Mirage_III#Origins
or
https://en.wikipedia.org/wiki/Concorde
had a terrible accident ...
AIR did that quick flash sale the other day which I thought was just so they can say REVIVE. But I now notice some(maybe across more fares but don't have the desire to burn time) of the business class fares have remained at half of what other airlines are charging for similar routes. So you can still get AKL to LAX business for circa $6T. Here is one very scary possible reason. They get the cash for that sale now. They have learnt to use cash from forward sales in the present. They don't get the cash issue money for a little more than a month, when the new shares are issued. If I was a betting man what odds would I put on these sales are at these discounted levels because they are desperate for the cash right now.
Don’t think so.
They have not fully drawn down the government’s loan facility yet.
• Liquidity of $1.4 billion as at 23 February 2022, made up of approximately $170 million of cash and $1.24 billion of available funds under the remaining Crown Facility and Redeemable Shares
Good point Balance. However so sure on the status of those agreements and access to cash. I would have said 100% that the new agreements that form the capital raise will have replaced those older ones. There will be provisions on the switch-over but who knows what those are. What are the other reason you sell product for 50% of your competitors?
Plus since then it had to pay for its PAYE final catch up payment, so that is the cash gone. Then the fuel price has gone up what?
A good dose of the current 'watch the Share price dive' is bound to ensure no laxatives are needed ;)
A major instalment of red ink delivered with more for the taking or the ever distant optimism of she'll bounce back
to be a multibagger in 15 years time - wonder which they'll opt in for ? ;)
"wonder which they'll opt in for ?"
they will go all in... nothing to lose!! Bargain!!!
well china is now closed .. plus some other country's and the middle east a bit if 'e and no one really wanting to cruise the Baltic and i usually do ! Invites for bears coming on upon return (not a bear drinker but this time will be)...
You would be surprised at the number of Aussie that used to cruise europe every year... LOTS!
Then there were the Kiwis cruising the Greek Islands..
It all adds up and it wont be adding up to quite the same numbers this time around.
Whole population of China now out of the travel business.. all locked up with MOA'S new republished works to study over the rice bowls...
Dont see AIR line profits returning to Pre C levels any year soon even if the air lines say other wise.
I looked up AKL-LAX return business class couple month ago and it was selling for about $11,600!
check out bus class via AKL - CPH...emirates is 10500 or there abouts ,
not bad really, 777
would rather go AIR BUS
AIR NZ business 10000 ODD return AKL CPH via LAX, return TOKYO.
787 , then AIR BUS 350 - 900 , 26 hours... remember those!!!!
Maybe it'll become NAC again like the good old days back in 1967 - this day in 1967 the maiden flight of this 737
IMO .. it will likely be 10 years before things finally show signs of any great improve at least ..
Call Covid with likely future variants + further waves at least a 5 year period, then lingering
on in some regions - such as some of the third world countries
that's a pretty long time for AIR's Board to be spinning fuzzies to investors about a little
light they thought the could see in the distance ;)
I had a most enjoyable day yesterday attending "The Skope Classic" at Mike Pero Motorsport Park,[Ruapuna ].
Was surprised at the very large number of Air NZ planes flying overhead on their approach to ChCh Airport.Seemed to be nearly back to Normal.
Only one Jet Star, and no international planes.Saw three planes' jet stream at above 30,000 ft.Must have been flying to Queenstown.
My grandad told me a popular saying during the war was to look upwards at a plane and say "Don't worry, it's one of ours."
Well it seems like "One of ours" is landing at Wellington Airport every 10 minutes. Busy = good.
For how much longer do people think AIR can hold on in the 0.80 range?
There was an ad on the radio this morning …… AIR recapitalisation ends soon etc etc ……don’t think it said hurry up don’t miss out for a chance to invest in this iconic company but the tone was a bit like that.
The Sharesies FB page has been an utter blitz of Air NZ offer posts. Most of them by Sharesies. They have done live chats with Foran, etc. The marketing is real
Depending on how the govt position has been handled ie get a underwrite fee for own stock, and bear in mind the govt will have had its own advisors, total direct fees, I guess, say $50m. Also note that the govt is selling circa 30m of its own rights. It is moving from 51.91% to 51% after the offer which is fully underwritten. The real pricing question will be what will be the bookbuild price. I find it remarkable that the public is being invited to bid in that but with no transparency on price setting mechanism nor any upper limit to price. That is where 20 years of "tighter regulation" has got us. I would bet if the NZX under the former member model still was with us that this situation would not be permitted. Sad.
Air NZ Chair:
"Sharesies had 100,000 customers who were shareholders in Air New Zealand, making it an important investor base for the airline, she said. Combined, Sharesies investors hold about 6 per cent of the airline’s shares.
"They're actually a highly engaged audience.""
Good luck to them. Not much confidence starting with this sort of crap: https://www.stuff.co.nz/business/ind...-strike-action
You'd want "danger money" to be breathing in everyone else's fumes on board a thin aluminum capsule. If AIR keeps up those tactics they won't have any staff left.
They market their platform as being no frills and no advice and then go on to promote the merits of this capital raise because its in their financial interest.
How much are they being paid, 30 pieces of Silver ?
"30 pieces of Silver"
its the roaring twenties all over again but wait MR B.
Reminds one of many cap raises and share floats over the ages.
Was wondering when the party over at SHAZ head quarters would melt down into a "well we sell rights to shares we hold in trust and WHO CARES!"
No MONEY from the SHAZ and the party stops.
AIR will do anything to get this one done and the money in the bank or they are Bank RUPT.
The "ethics" of what Sharsies are doing here to their otherwise poorly informed and certainly not professionally advised customers is really jarring to say the very least.