A further detail relevant to any calculations about this is that the shares are expected to go ex-rights on July 10th, which (as always with rights issues) is also when the rights are split off from the shares and become separately tradable.
So what happens at that point is that each 11 cum-rights shares become 11 ex-rights shares and 3 rights (*). Each right can be expected to have a market value very close to the market value of an ex-rights share minus 350p (**), and what happens overnight between July 9th and 10th is not expected to alter the values of holdings beyond normal stockmarket price fluctuations. So if C is the cum-rights share price and X the ex-rights share price, one can expect that:
11C = 11X + 3(X-350p)
That gives 11C = 14X - 1050p, so 14X = 11C + 1050p, or X = (11C+1050p)/14. That's the formula that allows one to calculate the theoretical ex-rights share price ("theoretical" because those stockmarket price fluctuations are likely to perturb it a bit in reality) from the cum-rights share price, and is what the announcement's statement that:
"
The Issue Price represents a 30.9 per cent, discount to the theoretical ex rights price based on the closing middle market price of 549.6 pence per Share on 18 June 2018 (being the last business day before the announcement of the terms of the Rights Issue)."
is based on: for C = 549.6p, the formula gives a theoretical ex-rights share price X = 506.83p, and the issue price of 350p is 30.9% below that. Note that that discount is
not a shareholder incentive: you have to give up 350p
and a right (which on the same basis can be expected to have a market value of 156.83p) to end up with an extra share. You can expect to save a little bit in trading costs (no stamp duty, and with many brokers no commission or other fee either) compared with just buying shares on the market, but only a little bit. (So why the discount, you might ask - the answer is that just 350p is the price the underwriters might be obliged to pay if things were to go very badly for the share price in the next few weeks. The subscription price will have been chosen to be low enough to make the underwriters willing to take the risk of being forced buyers for an only-halfway-unreasonable fee... In short, rights issue discounts are
underwriter incentives, not shareholder incentives!)
The other figure one can get from that calculation is how the value of the holding is split when the shares go ex-rights. The 11 cum-rights shares are worth 11*549.6p = £60.456, the 11 ex-rights shares are worth 11*506.83p = £55.751, and the 3 rights are worth 3*156.83p = £4.705, so about £4.705/ £60.456 = 7.8% of the original holding value goes into the rights and the remaining ~92.2% into the ex-rights shareholding. That ~92.2% figure is also the 'bonus' element adjustment to dividends for the rights issue - essentially, the company is saying that the ex-rights share is only ~92.2% of a cum-rights share, so you can only expect ~92.2% of the previous dividend for it. It's up to you as the shareholder to decide how you want to get income from the ~7.8% of the cum-rights shares that have gone into the rights - though obviously they'd like you to do so by using the rights as part payment for the new shares and receiving the dividends they pay!
On that basis, the final dividend of 9.8p has effectively been held, at 92.45% of the previous year's 10.6p (***). The total dividend for the year is still effectively up a bit (around 2%) because the interim was up about 6.5%. Nothing to worry about there, I think: companies that increase dividends and have a rights issue about the same time tend to attract "why are they giving with one hand and taking with the other?" criticism, while those that cut dividends and have a rights issue about the same time tend to attract "the real reason for the rights issue is that the company is in a bit of trouble" suspicions, so holding a dividend that's announced around the time of a rights issue is probably quite a sensible move.
(*) If your number of shares is not exactly divisible by 11, each odd cum-rights share will become an ex-rights share plus 3/11ths of a right, but you'll only get the number of rights that you're
completely entitled to and lose any odd fractions, i.e. your number of rights will be rounded
down from 3/11ths of your number of shares. So 1-3 odd shares over a multiple of 11 won't generate any extra rights over those generated by the complete sets of 11 shares, 4-7 will generate an extra right, and 8-10 will generate 2 extra rights.
(**) As long as the market value of an ex-rights share doesn't drop to close to 350p or below it. Basically, if it does drop that far, the fact that one can choose to subscribe to the right or let it lapse according to whether the share price has risen or fallen very close to the subscription deadline gives it some extra "heads I win, tails I break even" value.
(***) Yes, 92.2% is slightly less than 92.45%. But the ~92.2% figure will vary a bit depending on what cum-rights price one bases the calculations on - e.g. starting at the share price of 531p that I got when I looked just now, the theoretical ex-rights price is 492.2p and the ~92.2% figure becomes ~92.7% instead. I.e. all these calculations are approximate because of share price fluctuations: they should be treated as giving you good ballpark figures, not precise ones!
Gengulphus