Resolution Rights Issue

enya_3

This is so complicated. I have 36 shares in Resolution Ltd (from Friends Provident) and they are offering a rights issue (17 for 1) so I get another 619. The offer price is £1.50.
Shares currently are at around £2.25 each, but as far as I can see there is already a market for the rights Issue shares at around 79p!!!
Should I take up the offer or not?

Linton

enya wrote: »

This is so complicated. I have 36 shares in Resolution Ltd (from Friends Provident) and they are offering a rights issue (17 for 1) so I get another 619. The offer price is £1.50.
Shares currently are at around £2.25 each, but as far as I can see there is already a market for the rights Issue shares at around 79p!!!
Should I take up the offer or not?

The 79p is the market price for the RIGHT - ie if you dont have any rights you can buy one for 79p and then pay the £1.50 for a new share making a total cost of £2.29. This oddly enough is about the current price for a share.

As to whether you should do it - if you aren't already into share dealing, and only having about £80 worth of the shares suggest you aren't, then I would suggest it's not worth the hassle.

If you dont exercise your rights these are usually sold on the market and you will get your 79p (or something different depending on the main share price at the time).

sabretoothtigger

Alot of people asking about this who were fp owners I take it. Questor wrote about them from pov of a small investor, see if you agree

ESKIMO

I would urge on the side of caution.

I would question the 'ethic and morality' behind the decision.

Do some investigative work and research on it. Is it raising money to pay-off some bad debts or is it attempting to increase it's market presence and exert it's dominance on others?

Case study: Bradford & Bingley and RBS.

Moral of the story. Learn from others' mistakes.

Maisiemouse_2

As far as i can see the old Friends Provident shares became Resolution shares and have recently changed again following the rights issue. I had 1325 Resolution shares up until a few weeks ago but with the new rights issue this changed and as far as i can see you now have 1 share for every 30 you hold, i now have 44 shares !!!!!! - i didnt know that this would happen and thought that i would keep my existing share holding and if i wanted to buy some more shares i could. I didnt want to part with any more money so didnt take up the rights issue offer although the time scale for replying was quite tight. I am disgusted by what has happened and the lack of clear information given. i am much worse off now - does anyone know what is going on with this rights issue or the consolidation of shares ?

n0438

Aren't they trying to raise the money to buy AXA???

mrd_4

Maisiemouse wrote: »

As far as i can see the old Friends Provident shares became Resolution shares and have recently changed again following the rights issue. I had 1325 Resolution shares up until a few weeks ago but with the new rights issue this changed and as far as i can see you now have 1 share for every 30 you hold, i now have 44 shares !!!!!! - i didnt know that this would happen and thought that i would keep my existing share holding and if i wanted to buy some more shares i could. I didnt want to part with any more money so didnt take up the rights issue offer although the time scale for replying was quite tight. I am disgusted by what has happened and the lack of clear information given. i am much worse off now - does anyone know what is going on with this rights issue or the consolidation of shares ?

Yes - I quite agree and have read on other sites people with the same opinion. Is this worth pursuing - I feel the information from Resolution has been lacking - intentionally?