Management confirmed reports that FGEN is planning to conduct a US$300Mil stock rights offering within the next six months. No other details are available, although we expect the issuance to lead to a dilution in NAV. Based on FGEN’s authorized capital to 2.77Bil shares, the lowest price at which FGEN can issue the rights is at Php9.30/sh, which is 70%% below NAV and 45.5% below market price. We did not assume that worst case scenario price for the rights offering of Php9.30/sh since management said that it does not want to issue the stock rights at a “significant” discount to FGEN’s fair value. Our Php15.00/sh assumption is 50% below FGEN’s prerights NAV and 11.8% below the company’s market price.
(Source : www.citiseconline.com)
Please click here for FGEN PSE disclosure.
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