Lloyds 37pence right issues

p1tse

are these a good idea?

can't see anything bad, as long as they don't drop any lower.

questions:

1. can one buy into them and sell them the next day at market rate and get a profit?

2. can one buy into them say 100 shares and then next day sell 50 and keep 50 etc.?

stinky_docker

The share issue is only for existing share holders (of which I'm one).

You get options at 37p per share,but as my shares last week were worth 85p and this week are 55pish it will only even out the drop caused by the issue.....

Once its over,you can buy at whatever the index price is

Hope this helps

p1tse

think the deadline is 11th dec for me, which i assume is for others to.
so does that mean at this point the numbers kept or sold is upto the owner of the shares?

do prices usually drop closer to right issue prices?

stinky_docker

Lloyds announced:

LLOYDS BANKING GROUP ANNOUNCES A PROPOSED 1.34 FOR 1 RIGHTS ISSUE OF 36,505,088,579 NEW SHARES AT AN ISSUE PRICE OF 37 PENCE PER NEW SHARE

Unless otherwise defined in this announcement, capitalised definitions shall have the same meaning as in the rights issue prospectus (the "Prospectus") published on 3 November 2009 by Lloyds Banking Group plc (the "Company" or "Lloyds Banking Group") in connection with the Rights Issue.

Lloyds Banking Group is pleased to announce that the Issue Price at which the New Shares will be offered pursuant to the Rights Issue has been set at 37 pence per New Share.

The Rights Issue comprises the offer of 36,505,088,579 New Shares at an Issue Price of 37 pence on the basis of 1.34 New Shares for every 1 Existing Ordinary Share held at the Record Date. The expected gross proceeds of the Rights Issue receivable by Lloyds Banking Group total £13,506,882,774.

The Issue Price represents a discount of 59.5 per cent. to the Closing Price of the Company's Ordinary Shares on 23 November 2009 (being the latest practicable date prior to the publication of this announcement) and a discount of 38.6 per cent. to the theoretical ex-rights price based on this Closing Price.

The New Shares will represent 57.3 per cent. of the enlarged share capital of Lloyds Banking Group immediately following completion of the Rights Issue and Share Subdivision.

This basically means,for one of you shares you get 1.34 new shares,the price dropped this week by 40% give or take,and as has been discussed on another thread,you really should consider taking the option as it will only dilute the price.

The other possible method was to sell pre announcement,then buy after the option have been issued if the price is lower,but who could tell and who really knows what the price will be.....????

Biggles

p1tse wrote: »

1. can one buy into them and sell them the next day at market rate and get a profit?

Much simpler would be just to sell your Rights nil-paid. They are presently trading at 17.75p each.

muymalestado

p1tse wrote: »

are these a good idea?

can't see anything bad, as long as they don't drop any lower.

questions:

1. can one buy into them and sell them the next day at market rate and get a profit?

2. can one buy into them say 100 shares and then next day sell 50 and keep 50 etc.?

Well you've not been watching if what has happened to Lloyds/HBOS isn't BAD. As for not dropping lower - that attitude is for dreamers, like I was once. Who'd a thot that Dubai World even existed let alone had been soaking up credit from UK banks.

Never underestimate a pretty horizon as not being able to send rainstorms over you.

1. & 2. Shares are still being traded so one assumes you could do some day trades.

iainfitzy

Can anyone point me in the direction of a simple explanation of what has happened.

Instead of having only LLOY shares, I know have LLOY Ord 10p shares and LBGN Shares?

I now have negative % change across my portfolio?

Rollinghome

iainfitzy wrote: »

Can anyone point me in the direction of a simple explanation of what has happened.

Instead of having only LLOY shares, I know have LLOY Ord 10p shares and LBGN Shares?

I now have negative % change across my portfolio?

You've now got your Ordinary shares, LLOY, and Lloyds Bank Group Nil-paid shares, LBGN, your rights.

stinky_docker

Basically after just speaking to my broker,you will be issued 1.34 new shares on or around the 16th december at 37p per share,you'll also keep your existing shares....

Wether its worth it or not is all conjecture as all share dealing is,it will depend on the price after the share issue (and LLOY Ord is your current shares,LBGN Shares are what you'll own after the issue as long as you take up the option...

Andy

ronaldo746

i presume if everyone doesnt takes up their rights, the share price will drop?

Lakeuk

ronaldo746 wrote: »

i presume if everyone doesnt takes up their rights, the share price will drop?

The share price has already dropped to reflect the additional shares that will be entering the market