It has been a while since the last update of my portfolio; since then the market has experienced a turbulent time of decline. Among my portfolio, a stock of mine, First Ship Lease Trust (FSL Trust)has announced a drastic corporate actions. This too has spurred me to react.
Divestment- First Ship Lease Trust
In Nov 2018, FSL announced plans to issue a non renounceable equity raising by issuing new shares at a ratio of 3 new shares for every 2 shares at a price of $0.045. The price of the new shares was at a massive discount to FSL’s reported book value of $0.37 as well as the company’s fair value of about $0.10 based on the current fleet’s value. The issue price is deeply discounted. What is perhaps even more shocking is that is the “non renounceable” nature of this action.
A “non-renounceable” offering means that