Subscribed to my first Preferential Offering!

Source: gettyimages, Bloomberg

Well, as you folks may have heard, Mapletree Commercial Trust is acquiring Phase 1 of the Mapletree Business City, which will be funded by debt and equity.

You can view the presentation here.

Some people do not like rights/preferential offerings and, as a result, REITs, because they make investors cough out more money. If you do not apply, it might dilute your holdings, which is annoying as well.

For my small portfolio, I see it as a way, along with scrip dividends, to help me get more shares of companies I want without incurring expensive brokerage fees.

So they have offered us unitholders 17-for-100 entitled units, which just means that you are entitled to get up to 17 shares per 100 shares you own, but sadly, fractions of a share aren't considered nor rounded.

So I did my own reading around the Singapore Blogosphere and got an idea how it is done.

Some good resources to read are:

• fifthperson.com/a-step-by-step-guide-how-to-apply-for-rights-shares-by-atm/
• bullythebear.blogspot.sg/2016/08/the-difference-between-preferential.html 
• bullythebear.blogspot.sg/2014/02/how-to-apply-for-rights-and-what-are.html
• bullythebear.blogspot.sg/2011/01/how-to-get-most-out-of-rights-exercise.html
• bullythebear.blogspot.sg/2015/10/for-casual-croesus-rights-players.html
• bullythebear.blogspot.sg/2015/10/for-advanced-croesus-rights-players.html

I also decided to apply for excess rights too. As my position is small, and I have odd lots, I decided to apply for 4000 (just whack), in hopes I get more than my entitled rights. If I don't get it, I'll get refunded anyway.

Do note that the preferential offering is at 1.42 per unit, which is a slight premium to book value, which is about 1.27 (~1.12x), paired with projected NAV increase of 1.31 (~1.08x), it is around midway between the historical highs and lows of PB ranges, so about fair value to a very slight premium. Just take it as adding on to my positions, though it depletes my cash positions T_T.

The instruction booklet gives an instruction for DBS account holders but I'm a OCBC account holder so I'll give the directions here (more or less the same though but slightly different):

1. Insert your personal OCBC ATMs
2. Enter your PIN
3. Select "More Services"
4. Select "Investment Services"
5. Select "Rights Application"
6. Select the Rights you wanna apply for (in this case, “MAPLETREECOMNRO”)
7. Press Acknowledge for each of the terms and conditions
8. Confirm your CDP number (and NRIC I think)
9. Enter number of units you wish to accept
10. Enter number of excess units you wish to apply for
11. Select Bank account to debit funds from
12. Confirm the details of your applications
13. Get your Transaction Advice for your reference and record

Something I didn't know also was that I was dinged by a commission of $2. Meh, same as SSB. Not that it is a lot of money (I was hoping for zero comms though :x) it is cheaper than accumulating more via brokerages, but no one said anything about it, so just a heads-up.

And here it is my receipt! :D

For those of you who have not applied, the deadline for the application is 17 August 2016 9.30pm, do take note (I saw Croesus Retail Rights Issue too, if anyone is having them, so might be the time to apply if you own those shares).

The Preferential Offerings will begin trading on 25 August 2016, keep a look out!


Have you applied for your Rights? :)

EDIT (16 Aug 16): Links for more information :)

EDIT (19 Aug 16): Update from MCT: http://infopub.sgx.com/FileOpen/MCT%20-%20Results%20of%20Preferential%20Offering%20Announcement_190816_Final.ashx?App=Announcement&FileID=418127