Investors Trade Rights in Oando, Hallmark

Investors Trade Rights in Oando, Hallmark

 

Determined not to lose  the opportunities offered by the Rights Issues of Oando Plc and Hallmark Paper Products Plc, some investors who could not take up their rights in the two companies traded them on the floor of the Nigerian Stock Exchange (NSE) last week.

 

 

The Nigerian Stock Exchange (NSE) in its weekly report said investors in the two companies traded their rights to the tune of 125.3 million shares worth N741.93 million in 112 deals last week.However, the NSE did not give the breakdown of trading in each of the companies. Both companies accessed the market to raise funds from existing shareholders via rights issues.Hallmark Paper Products  accessed the market for N250 million through the issuance of 100 million ordinary shares of 50 kobo each at N2.50 per share on the basis of two new ordinary shares for every one ordinary share of 50 kobo already held. The offer was  made at a discount price of 22 per cent.

 

 

Also, Oando Plc accessed the market for N21 billion from existing investors by issuing 301.695 million shares of  50kobo each at N70 per share, showing a discount of 24 per cent.Realising that they may not be able to take their rights due to financial constraints, some investors of the two companies decided to trade their rights on the floor. Before now, the Group Managing Director of Oando Plc, Mr. Wale Tinubu, had said investors who would not be able to exercise their rights could trade them on the floor of the NSE.

 

 

“Given the future prospects in the company and the incentives the rights issue price offer, we are confident that all our shareholders will use this opportunity to increase their share holding in the company. But should there be any shareholder who may be prevented by one reason or the other from being able to take up their rights, they can trade the rights on the floor. By doing so they will not be losing out completely,” had Tinubu said.

 

 

By trading their rights, the shareholders have benefited from the opportunities in the offer instead of losing out completely. In the past,  investors were not able to trade their rights until the NSE introduced the instruments as part of deepening the market.As a result, investors who  do not have the cash to pick up their rights can trade them on the floor and realise their benefits.

 

(Source:ThisDay)


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