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Below rights issue price

lse:kie

#1

Looks as if rights issue could be left with underwriters. What about a rescue bidder?


#2

What are you saying? They are struggling to get the rights issue accepted?


#3

If shareholders can buy shares at a price below 405p why should they pay 405p? In such a scenario the shares not taken up are left with the underwriters of the rights issue to pay 405p.


#4

I think a line has to be drawn and that means the Board who have seen a share price fall, from say £15 to £4, replace both CEO and CFO with people who can restore trust in the share price.


#5

I am still short on this. Should they replace the board of Balfour Beatty too?


#6

Seems as though the Short Sellers - who at circa 13%, at last info., have made a FORTUNE so far - are going for a total wipeout. Carillion 2? Sure hope not; we are in there!

BTW, I saw £4.09/share as the RI offer? Is £4.05 the correct unit price?


#7

Well they have understated their debt! What are the four other contractors which banks might not lend to?


#8

I feel a little silly asking this but genuinely would like to know if there is any reason to accept the rights issue at 409 if the current share price is lower?


#9

Trump and Brexit are hurting share prices and it could drag on for sometime. If share price is below 409, then it would be cheaper to buy shares in the market and not take up the rights issue, leaving the shares from rights issue with underwriters.

The next question is how much lower will K go?


#10

No. If you really want more then buy in the market, take dealing costs into account.


#11

@ronnie_e
Quite correct. Dealing costs in this case also includes Stamp Duty. - LLV


#12

FT and Times report on problems at Interserve. I think City will be concerned about the current state of the outsource market/firms, resulting in a possible down rating.

Timing of K’s rights issue - with hindsight should have been sooner.