Investors chase voting shares
Environmental Resources and Investments(ERI) ruled the markets
yesterday as investors chased up its voting shares and warrants to
record highs as the company revealed plans to raise capital.
Early in the day, the company announced a rights issue of one (1) for
every two (2) held at the rate of Rs 30.00, while also announcing an
issue of six (6) warrants for every share held. Warrants give the holder
the right but not the obligation, to buy new shares of the company at
future date at a price lower than they are expected to trade at that
time. ERIís new warrants are exercisable in three phases; 2012 at Rs
33.00, 2014 at Rs 36.00 and 2015 at Rs 39.00.
The warrants are allocated on the basis of two of each class for
every ordinary share held and one of every new class for every 2010
warrant and also for 2011 warrant held. With this news the shares and
warrants shot up to close at Rs 98.00 for the shares (up Rs 21.00 from
the previous close), Rs 74.25 for the both the W0000 warrant (up Rs
17.75) and W001 warrant (Up Rs 17.50).
The market indices closed down for the day with the ASPI at 3,495,
down 21 points (-0.6 percent) and the MPI at 4,006 down 5 (-0.1
Turnover for the day was Rs 1.3 billion with John Keells Holdings
closing at Rs 179.00 on business of Rs 295 million. ERI collectively
accounted for Rs 487 million in turnover.
Asian markets were mixed for the day with Tokyo and China gaining 0.8
percent and 1.5 percent respectively while declines were witnessed in
Hong Kong (0.4 percent), Singapore and India (0.6 percent for both)