Taylor Wimpey share offer @ 25p

uk_steve

i personly have my eyes on this but not @ 25p to 30p a share... if it hit around the 10p-13p a share i give it ago (i think time will be an issue on this but will hit there i am sure

(i hope anyway)

remember we have winter coming (i am sure the housebulilders will be even more slower then this slight increse now)

thats my view anyway

adambro

ricll wrote: »

TW is the last share I would buy right now. They are going downhill without brakes, sp is 32p at the moment, they are probably not even worthy 25p. I bought a few shares a while ago and will sell as soon as possible to avoid more losses. Buy some decent company, not this s*** managed by amateurs.

You don't say a lot about why Taylor Wimpey is such a bad investment other than to say it is. Perhaps you're slightly bitter due to apparently making losses. The share price is falling towards the rights issue price as is often the case. Many investors who held on the entitlement date might choose to sell before the rights issue to pick up more shares at the lower price and any new investors might wait to see where the share price goes after the issue.

Ultimately, you say it is going downhill but not a lot has changed since it was up at 50p but a lot has changed since it was down at 6p. The company has demonstrated their ability to restructure their finances to deal with the downturn and succesfully renegoitated terms with its creditors. This rights issue, whilst obviously dilluting share holdings a bit, will release the company from restrictions on paying dividends which is certainly in the interests of shareholders.

dc110

Something about the I will get 1999 1p shares with the option of buying at 24p.

i think you have misunderstood it

there is an open offer - 1 for 1 @ 25p each

after this there will be a subdivision of shares. each existing 25p ordinary share will be subdivided into 1 new ordinary share of 1p and 1 deferred share of 24p

the deferred shares will not be worth anything

so essentially

you hold 1999. if you subscribe in full to the open offer you get a further 1999 giving you a holding of 3998

you now have 3998 ordinary 25p shares

after the subdivsion you have 3998 ordinary 1p shares (and 3998 deferred shares that are worth nothing so you may as well forget these ever existed)

the subdivision is purely an exercise in changing the nominal value of the shares

sabretoothtigger

Well it sounds strange, where exactly does a share price go from 1p.

Is this their plan for growth, the only way is up. When do the deferred shares come into play

mrposhman

sabretoothtigger wrote: »

Well it sounds strange, where exactly does a share price go from 1p.

Is this their plan for growth, the only way is up. When do the deferred shares come into play

Its a red herring and means nothing. If you buy you will still have shares valued at 25p.

mrposhman

uk_steve wrote: »

i personly have my eyes on this but not @ 25p to 30p a share... if it hit around the 10p-13p a share i give it ago (i think time will be an issue on this but will hit there i am sure

(i hope anyway)

remember we have winter coming (i am sure the housebulilders will be even more slower then this slight increse now)

thats my view anyway

I think you will be waiting a VERY long time for this to hit anywhere near this level.

Institutions are snapping these shares up at 25p for a reason and thats because they will be worth a lot more in a few years time. The placing has been oversubscribed by the institutions and the open offer is fully subscribed.

mrposhman

ricll wrote: »

TW is the last share I would buy right now. They are going downhill without brakes, sp is 32p at the moment, they are probably not even worthy 25p. I bought a few shares a while ago and will sell as soon as possible to avoid more losses. Buy some decent company, not this s*** managed by amateurs.

Ever heard of the TERP? Based on the last "proper" valuation of the company prior to the statements about the open offer and the placing the share price was 48.5p. The TERP is then 48.5+25+25 / 3 = 33p.

Funnily enough we briefly dropped below this yesterday due to market sentiment and also as yesterday was the last day to get your shares sold if you wanted to have cleared funds in your account prior to the 19th (the day most brokers have stated you need cleared funds to take up the offer). The SP rose back above the TERP this morning indicating that TW. are trading on a premium to the price before the announcements.

Whats more, there is now a possibility of a dividend (no possibility before) and all debts have been assured until 2012.

Not really as bleak a picture as you paint.

adambro

mrposhman wrote: »

The placing has been oversubscribed by the institutions and the open offer is fully subscribed.

And you know this how exactly?

mrposhman

adambro wrote: »

And you know this how exactly?

Redfern stated it somewhere. I can't remember exactly where though.

Sorry by saying the open offer is fully subscribed, I mean its fully underwritten so will definately be fully subscribed. Maybe not by shareholders but by institutions too.

adambro

mrposhman wrote: »

Redfern stated it somewhere. I can't remember exactly where though.

Sorry by saying the open offer is fully subscribed, I mean its fully underwritten so will definately be fully subscribed. Maybe not by shareholders but by institutions too.

Thanks for clarifying. I trust you understand my suspicions of some of what gets posted on the web about these kinds of situations.

Redfern has said (http://uk.reuters.com/article/innovationNews/idUKTRE5473VZ20090508?pageNumber=1&virtualBrandChannel=0) that the placing is oversubscribed and as you note the open offer is fully underwritten but I understand that was usually the case so perhaps not as good an indication of the market's feeling about TW as the oversubscribed placing is.