National grid shares help

pinkdaisylemon

EthicsGradient said:

No, you won't lose much money if you do nothing.

In addition to the 140 shares you already had, they have assigned you 140 * 7 / 24 = 40 "nil-paid shares". These give you the opportunity to pay £6.45 per nil-paid share (£258 in total, not £285, I think) to convert them to fully-paid shares, like the ones you already have (and which would be worth about £8.13, on today's market). But you should only pay that if you want to invest more in National Grid, and have the cash available - which you don't.

If you do nothing, then around the 12th June, they will sell those nil-paid shares for you - they currently trade for about £1.68, because that's £8.13 minus £6.45. So you'll get sent some money (probably a cheque, if you hold paper certificates; if you hold the shares on a platform (eg in an ISA or SIPP) they'll credit your account). This will be a reasonable deal. The market price of both the existing and nil-paid shares may vary between now and 12th June, so you can't say exactly how much you'll get if you wait (could be more, could be less - that's the nature of markets) - if the price stayed the same, it ought to be £1.68 x 40 = £67.20.

After that, the future dividends you'll get from National Grid will be a bit less than before.

You could sell all your shares, both the old and the nil-paid shares, in the market now.  But that will mean paying some dealing costs. 

You may have been given the "cashless take up"  or "tail-swallowing" option mentioned above. If, in whatever documentation you have, printed or online, you find that as an option offered, it might be a good option for you - it means you don't have to contribute any extra cash, but neither will they send you much money - they'll balance selling some shares and paying the £6.45 for the remainder to keep how much your investment is worth roughly level.

Thank you for your help. Can I ask you one more question please? If I was able to raise the 258 to buy the new shares would this be a good investment? Are these shares likely to go up a lot in value? I know it's hard to say but in effect are they worth having do you think? Thank you so much 

wmb194

xyz123 said:

wmb194 said:

xyz123 said:

wmb194 said:

At the moment the rights are selling for roughly 200p each.

https://www.londonstockexchange.com/stock/NGPN/national-grid-plc/company-page

Hi, can I please ask how can anyone buy these nil Shares from those who don't want it?

Thanks 

A stockbroker. Not all will offer nil-paid rights, though. I don't know but you could try the likes of AJ Bell and Hargreaves Lansdown.

Thank you. A laymen's question. The price of rights at 200p is basically 200p for rights +645p for actual shares so total 845p or have I got this wrong? 

Correct.  

TATJAM

So if I sold the rights under Option 2  would I get £645 or £845 ?

EthicsGradient

pinkdaisylemon said:

EthicsGradient said:

No, you won't lose much money if you do nothing.

In addition to the 140 shares you already had, they have assigned you 140 * 7 / 24 = 40 "nil-paid shares". These give you the opportunity to pay £6.45 per nil-paid share (£258 in total, not £285, I think) to convert them to fully-paid shares, like the ones you already have (and which would be worth about £8.13, on today's market). But you should only pay that if you want to invest more in National Grid, and have the cash available - which you don't.

If you do nothing, then around the 12th June, they will sell those nil-paid shares for you - they currently trade for about £1.68, because that's £8.13 minus £6.45. So you'll get sent some money (probably a cheque, if you hold paper certificates; if you hold the shares on a platform (eg in an ISA or SIPP) they'll credit your account). This will be a reasonable deal. The market price of both the existing and nil-paid shares may vary between now and 12th June, so you can't say exactly how much you'll get if you wait (could be more, could be less - that's the nature of markets) - if the price stayed the same, it ought to be £1.68 x 40 = £67.20.

After that, the future dividends you'll get from National Grid will be a bit less than before.

You could sell all your shares, both the old and the nil-paid shares, in the market now.  But that will mean paying some dealing costs. 

You may have been given the "cashless take up"  or "tail-swallowing" option mentioned above. If, in whatever documentation you have, printed or online, you find that as an option offered, it might be a good option for you - it means you don't have to contribute any extra cash, but neither will they send you much money - they'll balance selling some shares and paying the £6.45 for the remainder to keep how much your investment is worth roughly level.

Thank you for your help. Can I ask you one more question please? If I was able to raise the 258 to buy the new shares would this be a good investment? Are these shares likely to go up a lot in value? I know it's hard to say but in effect are they worth having do you think? Thank you so much 

Hard to make a judgement, of course. Personally, I am leaning towards buying my own new shares - in theory, I can see that National Grid needs to invest in plenty of new infrastructure to handle the new loads from renewables, and for the increasing demand from rechargeable vehicles and heat pumps, so I hope the business will successfully grow from this. And the 2 articles I've read from analysts reckoned they were worth buying, but I haven't been searching for such articles, so I don't know if that's representative. But we can't advise other investors here - we're all amateurs.

One thing to note - the "cashless take up" offer from National Grid and Equiniti, which I think has been sent to paper certificate holders, has to be taken up before 5pm tomorrow, I think. After that, if you wanted to sell some and pay for the rest, you'd have to work out how many yourself, and find a broker to do it for you (for which the fees would probably make it unattractive).

Blossom38

Thank you "gatters" for your explanation.

xyz123

TATJAM said:

So if I sold the rights under Option 2  would I get £645 or £845 ?

If you just sell the nil paid shares/rights, you just get 200p in my example (rate today for nill paid shares is around 150p)

caper7

xyz123 said:

TATJAM said:

So if I sold the rights under Option 2  would I get £645 or £845 ?

If you just sell the nil paid shares/rights, you just get 200p in my example (rate today for nill paid shares is around 150p)

And what do you get with option 4, doing nothing? 

TATJAM

xyz123 said:

TATJAM said:

So if I sold the rights under Option 2  would I get £645 or £845 ?

If you just sell the nil paid shares/rights, you just get 200p in my example (rate today for nill paid shares is around 150p)

Thank you !

pinkdaisylemon

EthicsGradient said:

pinkdaisylemon said:

EthicsGradient said:

No, you won't lose much money if you do nothing.

In addition to the 140 shares you already had, they have assigned you 140 * 7 / 24 = 40 "nil-paid shares". These give you the opportunity to pay £6.45 per nil-paid share (£258 in total, not £285, I think) to convert them to fully-paid shares, like the ones you already have (and which would be worth about £8.13, on today's market). But you should only pay that if you want to invest more in National Grid, and have the cash available - which you don't.

If you do nothing, then around the 12th June, they will sell those nil-paid shares for you - they currently trade for about £1.68, because that's £8.13 minus £6.45. So you'll get sent some money (probably a cheque, if you hold paper certificates; if you hold the shares on a platform (eg in an ISA or SIPP) they'll credit your account). This will be a reasonable deal. The market price of both the existing and nil-paid shares may vary between now and 12th June, so you can't say exactly how much you'll get if you wait (could be more, could be less - that's the nature of markets) - if the price stayed the same, it ought to be £1.68 x 40 = £67.20.

After that, the future dividends you'll get from National Grid will be a bit less than before.

You could sell all your shares, both the old and the nil-paid shares, in the market now.  But that will mean paying some dealing costs. 

You may have been given the "cashless take up"  or "tail-swallowing" option mentioned above. If, in whatever documentation you have, printed or online, you find that as an option offered, it might be a good option for you - it means you don't have to contribute any extra cash, but neither will they send you much money - they'll balance selling some shares and paying the £6.45 for the remainder to keep how much your investment is worth roughly level.

Thank you for your help. Can I ask you one more question please? If I was able to raise the 258 to buy the new shares would this be a good investment? Are these shares likely to go up a lot in value? I know it's hard to say but in effect are they worth having do you think? Thank you so much 

Hard to make a judgement, of course. Personally, I am leaning towards buying my own new shares - in theory, I can see that National Grid needs to invest in plenty of new infrastructure to handle the new loads from renewables, and for the increasing demand from rechargeable vehicles and heat pumps, so I hope the business will successfully grow from this. And the 2 articles I've read from analysts reckoned they were worth buying, but I haven't been searching for such articles, so I don't know if that's representative. But we can't advise other investors here - we're all amateurs.

One thing to note - the "cashless take up" offer from National Grid and Equiniti, which I think has been sent to paper certificate holders, has to be taken up before 5pm tomorrow, I think. After that, if you wanted to sell some and pay for the rest, you'd have to work out how many yourself, and find a broker to do it for you (for which the fees would probably make it unattractive).

Thank you so much for all your help it is so kind of you. Can I ask one more question - if I do the cashless take up roughly how many new shares would I end up having? Hope that makes sense! 

pinkdaisylemon

pinkdaisylemon said:

EthicsGradient said:

No, you won't lose much money if you do nothing.

In addition to the 140 shares you already had, they have assigned you 140 * 7 / 24 = 40 "nil-paid shares". These give you the opportunity to pay £6.45 per nil-paid share (£258 in total, not £285, I think) to convert them to fully-paid shares, like the ones you already have (and which would be worth about £8.13, on today's market). But you should only pay that if you want to invest more in National Grid, and have the cash available - which you don't.

If you do nothing, then around the 12th June, they will sell those nil-paid shares for you - they currently trade for about £1.68, because that's £8.13 minus £6.45. So you'll get sent some money (probably a cheque, if you hold paper certificates; if you hold the shares on a platform (eg in an ISA or SIPP) they'll credit your account). This will be a reasonable deal. The market price of both the existing and nil-paid shares may vary between now and 12th June, so you can't say exactly how much you'll get if you wait (could be more, could be less - that's the nature of markets) - if the price stayed the same, it ought to be £1.68 x 40 = £67.20.

After that, the future dividends you'll get from National Grid will be a bit less than before.

You could sell all your shares, both the old and the nil-paid shares, in the market now.  But that will mean paying some dealing costs. 

You may have been given the "cashless take up"  or "tail-swallowing" option mentioned above. If, in whatever documentation you have, printed or online, you find that as an option offered, it might be a good option for you - it means you don't have to contribute any extra cash, but neither will they send you much money - they'll balance selling some shares and paying the £6.45 for the remainder to keep how much your investment is worth roughly level.

Thank you for your help. Can I ask you one more question please? If I was able to raise the 258 to buy the new shares would this be a good investment? Are these shares likely to go up a lot in value? I know it's hard to say but in effect are they worth having do you think? Thank you so much 

Sorry I realise of course you have already answered this! What I meant to say is if I use a bit of savings to buy the rights is it worth it to just keep them knowing if I need the cash at a future date I could sell? Do you think this is plausible or would I be losingoney doing it this way? Hope that makes sense