Many older generation Singaporeans have bought and held Singapore Airlines shares for years from the highs because they steadfastly believed in the leadership of Singapore Airlines and that the Singapore Government would never leave a Singaporean behind. Yet from the recent Singapore Airlines Rights and MCB issuance, the mom and pop retail investors buy the brunt of it. 

 

As we speak, there is little clarity as to how the MCB work and what to do with the MCB. Many of us have odd lots or every little lots of MCB ranging from 2950 to 29500 to some 295000 MCB rights. Whilst these MCB may appear " free" , they essentially are worthless or rather negative  towards Mom and Pop investors. This is because the Cost to sell the MCB rights is Higher than the value gain. To sell 2950 MCB rights, you get 5.90 SGD in value but the Brokerage fee is at least 25 SGD. 

 

The other option is for Mom and Pop investors who do not have the deep pockets and means to exercise the MCB to let the MCB expire. But this means that during this pandemic, the average Singaporean loses the potential income that is supposed to arise from the MCB. There' s also a potential dilutive effect in the long term for existing shareholders of Singapore Airlines who do not subscribe to the MCB or rights.

 

As Singaporeans who have believed in the Singapore Government and system, we hope for the following:

(1) More clarity on the MCBs in terms of what happens after 28 May 2020: Does Temasek automatically get the right to the MCB when it expires unexercised on 28 May 2020?

(b) Perhaps a fairer way would be for Temasek to undertake to buy at 0.003 or a fair value price from MCB holders without the need to go through a brokerage hence Singaporeans can get some money from their MCB as opposed to having to lose money on the MCB.

 

(c) In terms of the regulatory framework, what happens to the Short Sellers of MCBs who are pressing the MCB prices down now in the Open Market. What happens if and/on the 21 or 28 May, they do NOT have the MCB Rs that they Short Sold?

 

These are questions that everyday Singaporeans who may have 1lot ot 100 lots of our national carrier. Perhaps, the government or SIA can issue clarity on the MCB issue to help the everyday Singaporeans who have bought the SIA shares as their nest egg. Don' t just save SIA, save the average Singaporean as well.