Rights Offerings - Cash Proceeds?

🤝 Help
1

Hi
For any companies that do rights offerings - how do you deal with those?

Are the rights sold and cash proceeds given to shareholders? - given you don’t support corporate actions.

NASDAQ: FGF is doing one.
https://www.sec.gov/ix?doc=/Archives/edgar/data/0001591890/000149315221025560/form8-k.htm

2

Its all in the help centre.

3

Reading through it I just noticed that it doesn’t explain what happens if you don’t subscribe the rights issue.
I have searched for other posts in the help centre and it doesn’t seem to be explained.

I believe that if you don’t exercise the rights what T212 does is it sells the rights and gives you the proceedings (cash market value at close) of those rights.
A suggestion: If this is the case, is it maybe worth adding a brief sentence about this on the help centre article @Team212?

4

Normally what happens in the market is the rights lapse and you get zilch. If 212 are able to sell unused rights just be fore the expiry, then they’re doing users a favour.

5

Okay, but in that case users should be able to have the option of selling them before expiry?
Aren’t rights traded?
I seem to remember seeing them “listed”.

6

Morning, everyone :wave:

Typically, there are 2 types of rights:

  1. Tradable - where If a client decides not to subscribe for a rights issue, their rights will be sold at the market, and as a result, proceeds distributed shortly after to their account.

  2. Non-tradable (open offer) -where there are no rights. Either you subscribe or not and if a client chooses not to participate, they don’t receive anything.

@EquityInvestor That’s a great idea and I’ve already passed it along for consideration.