What are Rights?
A rights issue is an invitation to existing shareholders to purchase additional new shares of a listed company seeking to raise capital. A rights issue gives existing shareholders the right (but not the obligation) to purchase shares at a lower price before a specified date.
Actions you can take with rights
Rights are tradable securities on the market and can be used for one of the following:
- Sell your rights in the market
This will provide you immediate liquidity that can be used to invest in other securities (including the stock associated with the right). This can be done directly through the Thndr platform.
- Use the right to subscribe into the associated shares
This will allow you to purchase the stock at a discounted price. However, you will receive them after the subscription process ends, which may take months to conclude. There are instructions on how to do this below.
- Do nothing
By neglecting to subscribe to your rights or sell them in the market, you are putting yourself at risk of losing the value of that investment. Since rights are tradable for a set period of time and not forever.
Why don't we offer subscriptions to rights issues through Thndr?
Current rules and regulations associated with rights subscription entail many manual processes that are actioned by 3rd parties, along with Thndr. This means that the process is prone to human error and cannot be controlled for quality by the Thndr team. Accordingly, and in order to provide a quality service that fits our users, we have decided not support subscription requests through Thndr.
How to subscribe?
You must submit a subscription request through the bank responsible for taking subscription orders, since Thndr will no longer be taking any rights issue subscription orders.
These are the requirements for subscription:
- Request from Thndr support to unbook your owned rights
- Extract a personal account statement from your custodian at Ahli United Bank Branch
- Visit the bank responsible for subscription to submit your request.
- Pay the subscription fee to the bank responsible for subscription.
*More details will be provided with every rights issue as the process may differ.