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REITs and rights issues: Good at the right price.

Wednesday, October 11, 2017

Can I ask u a question regarding to recently cache log have issue a right maybe know is it this right can be convert able into share when expired?


Once they have expired, rights are worthless.


Did u know when is expired date? Pls
And How do I sell off


It has already expired.


Alamak like that mean nothing can I do with it?


I blogged about this. I even posted a reminder on my FB wall. 😉
All instructions and closing date in the package sent out by the CDP too.

Please be very careful and take note of all the dates when there are rights issues.

Exercise your rights to avoid dilution and, possibly, a big decline in distribution yield before the closing date.

How did Cache Logistics Trust's rights issue turn out for me?

I took up my entitlement and also subscribed for excess rights, receiving 40% more rights units than my entitlement as a result.

All investments are good at the right price and because heavily discounted rights units give the highest yields, unless it is a basket case, applying for as many excess rights as I can afford to makes sense to me.

Read this blog from earlier today?
Is AK the investor right 6x out of 10x?

Related posts:
1. Nil-paid rights and excess rights. 
2. Cache Logistics Trust 18 for 100 rights issue.


gupigug; said...

Hi AK,

I paid for the rights but do i have to do anything for it to convert into shares?
Also since it was a 18 for 100 shares, how did you manage to purchase 40% extra? pay more and hopefully, wont get refunded so you get shares instead? a bit confused by the whole process.

AK71 said...

Hi gupigug,

If you have paid for your rights, they will become regular units automatically.

For this rights issue, I got a bit more than 25 for 100 shares instead of 18 for 100 shares.

On top of accepting my rights entitlement, I applied for 200% more rights in the excess rights category.

So, I was trying for 54 for 100 shares.

Of course, I had no control over how much excess rights I would be given.

As expected, I got back most of my application money. :)

AK71 said...

Always apply for many more excess rights if we think that a rights issue is priced attractively.

For example, in a rights issue by IREIT Global, I received almost 78% more than my entitlement.

I was entitled to 1,575 rights. On top of this, I applied 20,425 excess rights.

I was successful in getting a total of 2,800 units.

How did IREIT's rights issue turn out for AK?

Anonymous said...

Other than the 100% of my entitlement, I applied 300% for the excess, but only got 5%. I applied thru SCB, not sure if the bank allocate correctly!!!

AK71 said...

Then, it could be just dumb luck on my part. ;p

AK71 said...

Nigel Lim:
Just curious - how do we subscribe to excess rights? Through ATM as well?

Yup. The ATM will ask how many rights we are accepting and how many excess rights we are applying for.

little toy brush said...

I got 42.5 per 100 instead of 18 per 100.

AK71 said...


Good to know that someone is luckier than I am. ;)

KW said...

try 50 per 100 but both my wife and me got 36.25 per 100

think it depends on the numbers of units you hold, small timer like less then 10 lots of mother share will get a higher excess rights application?

AK71 said...

Hi KW,

The decision making process beyond the rounding up of odd lots and who are eligible really isn't transparent.

Sometimes, small holders get a higher percentage. Sometimes, big holders.

For one of AA REIT's rights issue many years ago, when I collected feedback from readers, the big holders were the ones who benefited more.

Congratulations on getting more excess rights! :)

AK71 said...

Reader says...
Hi AK,would you be able able to share your experience on the application of excess rights?
Is there a "formula" which would allow us to obtain the most number of shares? Do we be greedy and apply for as much as we can stomach (and hope that we will be given these shares) or we should be realistic and apply for reasonable number of excess shares.

AK says...
Despite what some might say, it really depends on luck 😉
The issuer has the final say in how excess should be distributed.
Sometimes, bigger holders benefit more and sometimes smaller holders benefit more, from what I see over the years.
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