Shares & Derivatives
Sembcorp Marine ex-rights tomorrow. Is there an arbitrage opportunity?
By New Academy of Finance  •  August 12, 2020
Sembcorp Marine shares are expected to trade ex-rights tomorrow. This means that today is the last day which Sembcorp Marine shares will be trading “cum-rights”. For those who are not familiar with these terms, simply put, if you are a Sembcorp Marine shareholder and did not sell your shares today on the 12 August, you will be entitled to the rights shares. Recall that for every 1 shares of Sembcorp Marine that you own, you will be entitled to 5 rights shares. These right shares can be exercised at $0.20/rights. Meaning that if you wish to subscribe for these rights, you need to pay $0.20/rights to convert them into actual shares. If you own 1,000 shares of Sembcorp Marine, you will need to fork out (5,000 rights * 0.20) = S$1,000 if you wish to convert the 5,000 rights shares that you own into actual shares and avoid dilution. In this example, you will end up with 6,000 shares of Sembcorp Marine....
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By New Academy of Finance
I have got no sob-stories to entertain ya. I am just a regular joe, happily married, with two “highly energetic” young boys that can never seem to settle down! Life is peaceful, or if you wish to put it with a tad of negative connotation to it, BORING. Some say boring is good!
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