SIA Right Issue Dates

Detail of Renounceable Rights Shares

Issue price of S$3.00

Three (3) Rights Shares for every two (2) existing ordinary shares

Name: SIA R    Symbol: LRDR

Start trading: 13 May 2020 from 9am

Last trading: 21 May 2020 at 5pm

Exercise rights by: 28 May 2020 at 5.00pm

Detail of Renounceable Rights MCBs

Issue price of $1.00

295 Rights MCBs for every 100 existing Shares

Name: SIA MCB R      Symbol: GANR

Start trading: 13 May 2020 from 9am

Last trading: 21 May 2020 at 5pm

Exercise rights by: 28 May 2020 at 5pm

Zero-coupon bond yielding at 4-6% depending on when it is redeemed

Callable every 6 months

Value of bond at maturity at S$1,806.11, based on $1,000 principal

Conversion of S$4.84 per Share, no cash


Dispatch of Offer Letter by CDP

Wednesday, 13 May 2020

Last date and time for acceptance of and payment for Rights Shares and/or Rights MCBs and/or applications for excess Rights Shares and/or excess Rights MCBs(1)

Thursday, 28 May 2020 at 5.00 p.m. for:
(a) applications made through CDP or the Share Registrar; and
(b) electronic applications through an online application website, subject to payment being made by 9.30 p.m. on the same day which the application via the online application website is made(2).

Thursday, 28 May 2020 at 9.30 p.m. for electronic applications through ATMs of Participating Banks

Source: SGX

Singapore Airline Bailout & Rights Issue

Singapore Airline Bailout & Rights Issue

SIA getting a Bailout from the government, that is a good news for all the consumer in the world. We love SIA, one of the Best Airline in the world.

How the Past Bailout turnout to be?
So what does it mean for investors? What is a Bailout? It simply means that the company is in need of funding and the government is helping by providing some liquidity. Yes, you are right! Up to aS$19Billion of funding to see through the Coronavirus crisis.

Exact details of the news here: https://www.nasdaq.com/articles/singapore-airlines-latest-to-get-massive-bailout-amid-coronavirus-crisis-2020-03-26

Question 1: Previously in 2008 what happen to some of the stocks that gets a Bailout from US Government?

I remember during that time when the Lehman brother collapes, all the bank shares got into trouble and share price plunge like crazy. The good news came when the US President Bush call for a neccessary bailout to save the financial system. They call it "too big to fail".

so 12 years later.. how is Citigroup doing?

Many people thought that Citigroup has recover to the 2007 price of $50+ but alot of people did not know that Citigroup fall more than 95% during the 2008 crisis and consolidate 10 shares become 1 shares. Example it used to be $50 drop to $5 and at $5 share consolidate 10 become 1, and price looks like $50 again.

So the price you see today.. $46 is still more than 90% down from the 2007 peak.

Another Bailout is also AIG... still more than 95% down after bailout and recently this stock crash like crazy again. 

But.. some Bailout may works.. look at the Japan Airlines in 2010, the company still around but shares holder might not.

Shares of JAL were delisted from the Tokyo Stock Exchange on 20 February 2010.^[46][47] At a time, its stock was considered one of "bluest of blue chips" of Japan.^[42] At the time, the bankruptcy was the largest Japanese bankruptcy involving a non-financial company and the fourth largest in Japan's history.^[42]

Read more on Wikipedia https://en.wikipedia.org/wiki/Japan_Airlines

Another Questions is the Rights Issue:

Rights issue simply means the company need more money. As a investors, we have to know why the company need more money, will they need more? Why not borrow from the banks? or Issue bonds to bigger investors?

Some Detail on the SIA proposed Renounceable Rights Issue :

Date of SIA Rights Period is not yet confirmFor every 2 SIA existing shares, you can subscribe 3 new shares.
The issue pice show a discount of  of 53.8% of March 25 price. To me, market will price in these already, it is a public news. So the "discount" is actually priced in and price will adjust when the rights is out.


Read the full announcement: https://links.sgx.com/FileOpen/Rights%20Issue%20Launch%20Announcement%20.ashx?App=Announcement&FileID=602566

For existing SIA Share holder. You can sell off the rights in the market when you receive the Rights.
or you can subscribe to the Rights.

Just understand that the currently trend of SIA is downtrend, nobody know what will happen or when the coronavirus will end and how the flight industry will work out in the future.

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