SINGAPORE (Nov 16): Tat Hong Holdings announced a renounceable underwritten 1-for-5 rights issue to raise $41.1 million after trading hours on Monday. On Tuesday, the stock lost 6.5 cents, or 14.3% of its share value, to close at 39 cents.
According to OCBC Investment Research analyst Jodie Foo, the rights issue price of 33 cents is a 27.5% discount to Nov 14’s closing price. In accordance to the share price reaction to the news, Foo has maintained her “hold” recommendation for the stock.
“Assuming the maximum subscription scenario where 125,776,884 rights shares will be issued, our fair value estimate is thus lowered from 49 cents to 40 cents,” she said in a note on Wednesday.
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