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SIA

8 Jun

btw, how much did you pay for the Rights?

a4andrew      ( Date: 02-Jun-2020 21:25) Posted: hi, Newbie here. if the nwshares get credited in cdp on 8 june (monday), when is the earliest time i can sell?

 

Good to see that the gloom and doom have lifted from this counter. At least for now. 

 

 

SIA directors opt not to subscribe for rights MCBs
MON, JUN 01, 2020 - 8:42 PM

MOST directors of Singapore Airlines (SIA) have chosen to let their rights  mandatory convertible bonds (MCBs) lapse without exercising them, despite proposing the MCB rights issuance to shareholders as part of larger cash call in April.

SIA chief executive  Goh Choon Phong let his  provisional allotments in respect of 3.34 million rights MCBs lapse last week, according to a Singapore Exchange filing on Monday.

SIA non-executive chairman Peter Seah also let  his allotment of 73,160 rights MCBs lapse last week, filings showed.  However, both Mr Goh and Mr Seah have applied to take up all their rights shares, and their actual allocations will be decided at a later date. 

Other SIA directors that let their rights MCBs lapse included  Gautam Banerjee,  chairman of Blackstone Singapore, and Simon Cheong of  SC Global Developments. Their provisional  allotments were  20,945 rights MCBs and  20,266 rights MCBs respectively. That said,  Mr Banerjee and Mr Cheong did subscribe for their rights shares entitlements.

Three other directors - David John Gledhill and Dominic Ho of DBS Bank as well as Lee Kim Shin, a managing partner of Allen & Gledhill - took up neither the rights shares nor the rights MCBs.

The Business Times  understands that this may be because Mr Gledhill  and Mr Ho count as foreign shareholders.  The rights are not  offered to shareholders with registered addresses outside Singapore.

https://www.businesstimes.com.sg/companies-markets/sia-directors-opt-not-to-subscribe-for-rights-mcbs

 

SIA rights shares fully subscribed Temasek to mop up bulk of MCBs
TUE, JUN 02, 2020 - 6:05 PM

THE rights issue of shares by Singapore Airlines (SIA) has been fully subscribed, though shareholders were less keen to participate in the rights issue of mandatory convertible bonds (MCBs), application results out on Tuesday showed.

At the close of the rights issue on May 28, valid acceptances and excess applications were received for 2.13 billion rights shares, representing close to 120 per cent of the 1.78 billion rights shares  available under the rights issue.

Controlling shareholder Temasek Holdings, which owns 55.5 per cent of SIA, took up its full pro-rata entitlement of 986 million rights shares.

A total of 67 million rights shares which were not validly taken up will be allotted to satisfy excess applications. SIA directors and substantial shareholders like Temasek will rank last in priority for the rounding of odd lots and the allotment of excess rights shares.

As for the rights issue of MCBs, this turned out to be under-subscribed.

https://www.businesstimes.com.sg/companies-markets/sia-rights-shares-fully-subscribed-temasek-to-mop-up-bulk-of-mcbs

 

hi,
Newbie here.
if the nwshares get credited in cdp on 8 june (monday), when is the earliest time i can sell?

 

This is a fair inference. However and unfortunately, we have BBs and shortsellers in the market. Given the sheer number of rights MCBs being issued - there could be hidden hands that push this down.
Let us see. I hope that they trade around SGD1 as well.  It was unfortuante that the Directors and CEO decided not to  subscribe for them.

kcowen      ( Date: 02-Jun-2020 19:43) Posted: 95% of the MCB is under temasek, 5% is with public. I am one of the 5%. If i paid S$1 just to buy this, i will not sell at a heavy discount price right. If temasek decided to sell at 0.8, then it could be possible. but will they just take that 20% immediate loss? i think the price will be just at around S$1 with low or no demand for both selling and buying. nngeeh      ( Date: 02-Jun-2020 18:15) Posted: Judging from the right issue price, it will be traded like a bond .... I remember the retail KrisEnergy Bond (0% Interest) which was redeemable only after few years and was trading at more than 50% discount at openning. I wonder what will the price at open .... interesting. Those who subscribe will really be prepared to hold long term as it should open below $1. The actual conversion price (if you take into consideration of the interest) is actually $2.7+ if i remember correctly. So, if SIA share price shoot up, this might go up, but bearing in mind that SIA can redeem this bond any time. You won' t get cash/ interest if the SIA crashes below $2.7 and still convert it at $2.7 after 10 yrs.... and if SIA really shoots up to say $6, they might just issue a new bond and redeem this instead at 4% instead of really letting you convert after 10 yrs at $2.7

 

95% of the MCB is under temasek, 5% is with public. I am one of the 5%. If i paid S$1 just to buy this, i will not sell at a heavy discount price right. If temasek decided to sell at 0.8, then it could be possible. but will they just take that 20% immediate loss? i think the price will be just at around S$1 with low or no demand for both selling and buying.

nngeeh      ( Date: 02-Jun-2020 18:15) Posted: Judging from the right issue price, it will be traded like a bond .... I remember the retail KrisEnergy Bond (0% Interest) which was redeemable only after few years and was trading at more than 50% discount at openning. I wonder what will the price at open .... interesting. Those who subscribe will really be prepared to hold long term as it should open below $1. The actual conversion price (if you take into consideration of the interest) is actually $2.7+ if i remember correctly. So, if SIA share price shoot up, this might go up, but bearing in mind that SIA can redeem this bond any time. You won' t get cash/ interest if the SIA crashes below $2.7 and still convert it at $2.7 after 10 yrs.... and if SIA really shoots up to say $6, they might just issue a new bond and redeem this instead at 4% instead of really letting you convert after 10 yrs at $2.7. Goldfinger      ( Date: 02-Jun-2020 18:06) Posted: Personally, I had to think quite long before for-going the Rights MCBs. What I was uncomfortable with was the that the conversion price in 10 years was a rather high SGD4.84.  Maybe with the recent SIA share price increase, this is quite possible.  Anyway, hope to buy on the market below 80cents when the MCBs are listed

 

Judging from the right issue price, it will be traded like a bond ....

I remember the retail KrisEnergy Bond (0% Interest) which was redeemable only after few years and was trading at more than 50% discount at openning. I wonder what will the price at open .... interesting. Those who subscribe will really be prepared to hold long term as it should open below $1.

The actual conversion price (if you take into consideration of the interest) is actually $2.7+ if i remember correctly. So, if SIA share price shoot up, this might go up, but bearing in mind that SIA can redeem this bond any time. You won' t get cash/ interest if the SIA crashes below $2.7 and still convert it at $2.7 after 10 yrs.... and if SIA really shoots up to say $6, they might just issue a new bond and redeem this instead at 4% instead of really letting you convert after 10 yrs at $2.7.

Goldfinger      ( Date: 02-Jun-2020 18:06) Posted: Personally, I had to think quite long before for-going the Rights MCBs. What I was uncomfortable with was the that the conversion price in 10 years was a rather high SGD4.84.  Maybe with the recent SIA share price increase, this is quite possible.  Anyway, hope to buy on the market below 80cents when the MCBs are listed. nngeeh      ( Date: 02-Jun-2020 18:02) Posted: Still need to go through motion ... Dun forget, Temasek is also a shareholder ..... so .... when they recommend to subscribe ... they are just going through the motion... and asking the shareholder (in this case .. Temasek) to subscribe. Maybe, one of the process in these organization, they will need the directors to recommend before they can proceed. Maybe... If they don' t recommend ... SIA will not have sufficient fund, and will collapse. As an investors, we' ll also have to do our homework.

 

Personally, I had to think quite long before for-going the Rights MCBs. What I was uncomfortable with was the that the conversion price in 10 years was a rather high SGD4.84.  Maybe with the recent SIA share price increase, this is quite possible.  Anyway, hope to buy on the market below 80cents when the MCBs are listed.

nngeeh      ( Date: 02-Jun-2020 18:02) Posted: Still need to go through motion ... Dun forget, Temasek is also a shareholder ..... so .... when they recommend to subscribe ... they are just going through the motion... and asking the shareholder (in this case .. Temasek) to subscribe. Maybe, one of the process in these organization, they will need the directors to recommend before they can proceed. Maybe... If they don' t recommend ... SIA will not have sufficient fund, and will collapse. As an investors, we' ll also have to do our homework.   Goldfinger      ( Date: 02-Jun-2020 17:44) Posted: Rights MCBs were undersubscribed by 40% - guess the CEO and Directors were in this pot.  I hope they had recused from commenting, when the company was promoting the Rights MCBs.

 

I am quite surprised that the total application is only 119% when SIA was already trading at $3.8 before the application closes. Many could have been spooked after reading all the remarks about the SIA shares going to go down below $3 ......

Can' t say about the future, it seems like it might stay above $4 on 8th June.

 

Still need to go through motion ...

Dun forget, Temasek is also a shareholder ..... so .... when they recommend to subscribe ... they are just going through the motion... and asking the shareholder (in this case .. Temasek) to subscribe. Maybe, one of the process in these organization, they will need the directors to recommend before they can proceed. Maybe...

If they don' t recommend ... SIA will not have sufficient fund, and will collapse. As an investors, we' ll also have to do our homework.

 

Goldfinger      ( Date: 02-Jun-2020 17:44) Posted: Rights MCBs were undersubscribed by 40% - guess the CEO and Directors were in this pot.  I hope they had recused from commenting, when the company was promoting the Rights MCBs.

 

Rights MCBs were undersubscribed by 40% - guess the CEO and Directors were in this pot.  I hope they had recused from commenting, when the company was promoting the Rights MCBs.

 

nice push up today. Yeah..

 

Another round right issue may be needed when take delivery of new planes.

 

Agreed from director' s point of view, my own mother would smack me if i were in their shoes and took up the MCB rights.
But psychologically damage is done. 

nngeeh      ( Date: 02-Jun-2020 15:14) Posted: The govt has already stated that the purpose of rights issue is meant to save the company and not for expansion ... we are talking about survival. SIA is raising 15 billions ..... if they raise it using via purely rights shares .... can you imagine the number of shares that they will need to issue and the impact on the share price. I guess the only way for the Govt to pump money into the company is via MCB.... To be fair to the directors .... which shareholders will want to have their money locked in SIA for 10ys without getting any interest back ... it' definitely noy beneficial to the shareholders. Just because they are directors .... unlike the govt who has the obligation to save our only carrier to ensure the transportation is still there to fly essential items into Singapore ... the directors are just like anyone of us who is working. I will not expect they to sacifice just because they are directors. It' s not really about really having faith or not ... who will want their fund to be locked for 10 yrs without knowing if they will still be SIA directors in the next few years.   turtletrader      ( Date: 02-Jun-2020 14:45) Posted: Disappointing to note most SIA' s directors opt not to subscrive for rights MCBs, while shareholders are encourage to subscribe...Need to have alignment of interest!

 

This news is negative. But market treats it reversely. Next time want to buy is time to sell 🤣

 

https://www.tradingview.com/chart/vAnVki8y/

SIA latest headlines: 1st June 20'
- Majority of SIA directors chooses to let their rights mandatory convertible bonds (MCBs) lapse without exercising them, despite proposing the MCB rights issuance to shareholders as part of larger cash call in April.
- SIA to reinstate certain flights in June & July, subject to regulatory approvals. Reinstated services include: Adelaide, Amsterdam, Auckland, Barcelona, Brisbane, Cebu, Copenhagen, Hong Kong, Medan, Melbourne and Osaka


Daily Chart:
Fib Retracement: Resistance at 3.96 (38.2%) and 4.08 (50%) levels remains to be tested
Moving Averages: Price close at 3.88 above 14 Day SMA , against weekly price advance of approx 7% on light volume. ( Bearish )
CMF: - 0.21 as of 1st June. No major catalyst likely for demand fill anytime soon. ( Bearish )

Weekly Chart:
MACD: MACD and signal lines at around -0.60, well below 0 break line. ( Bearish )
RSI: 28.80 as of 1 June 20' . Close to oversold territory (Value)
Money Flow Index: 33.39. Neutral with downward bias to oversell.

Personal take:
Best to steer clear of this counter for the near future, no prizes to infer lack of institutional demand as per SIA director' s actions as a proxy.
Possible value when overselling enters it' s final stages. 3.96 and 4.08 per share as resistance levels to watch going forward.

Hope SIA will be able to take to the skies soon. Miss travelling!

 

I believe you can buy SIA MCB from the market once it becomes listed. If sentiments are bad, that also means we can have it cheap. That is why not many holders want to exercise their Rights MCBs.

It is not the end of the story. Maybe, after 3 years can start Buying up. 10 years is the max. Can also Sell anytime, no need to wait max 10 years to redeem. 

 

 

Will the stock price drop once the rights are being converted to shares on 8 June?

 

Why would you be disappointed? Woud you subscribe to MCBs, they are also be like you, investing with their money.. In any case, Temasek will take all off the table, you need not worry.

turtletrader      ( Date: 02-Jun-2020 14:45) Posted: Disappointing to note most SIA' s directors opt not to subscrive for rights MCBs, while shareholders are encourage to subscribe...Need to have alignment of interest!