How does SIA MCB Rights Issue work?

Can non shareholders buy those MCB rights to those shareholders who want to trade them? Read that shareholders can trade on SGX. But I don't know which counter is this?

Hi Joseph,

To give you a summary, SIA will raise another $3.5 billion by issuing 10-year Rights MCBs which are of the zero-coupon bond variety.
A zero-coupon bond is a debt security that does not pay interest but instead trades at a deep discount. Profit is earned when the bond is redeemed.

There will be 295 Rights MCBs for every 100 existing shares owned priced at $1 each.

If you do not redeem the MCB before the maturity date, the MCB will be converted to new shares priced at $4.84, which is 10% higher than the Theoretical Ex-rights Price (TERP).

You can take a look at the key terms of rights MCBs here. These values are (1) Calculated based on a 6% annual yield to conversion, compounded on a semi-annual basis (2) Subject to adjustments, representing a 10% premium to TERP. They include consolidation or subdivision of Shares, capitalisation of profits or reserves, capital distributions, dividends, share repurchases and others.

To read more about the SIA fundraising package which includes Rights Issues of Shares, Rights MCBs and Additional MCBS, you could refer to a recent Seedly article here!​​​