mc2fool wrote:88V8 wrote:I was surprised to see how TRIG dilutes its holders.
What does it matter? So you end up with 0.001% of a £2bn IT instead of 0.002% of a £1bn IT; the £ value of your holding is the same.simoan wrote: And Private investors seem to be excluded from the equity raises.
Well that's certainly not true of all of them, I've had at least three offers in the time I've held them (since very soon after launch).
The matter of dilution is important. I see the effect with Primary Health Properties which regularly raises capital by share placings (and often/mostly excluding private investors). I agree that the reduction in economic value is usually insignificant for private investors but the effect is more obvious with dividend payments where the dividend has to be spread out over many more shares after a placing than before and it also holds back the share price at least in the short term. The effect of dilution has been particularly obvious with Phoenix Holdings which has issued lots of new shares to SLA and to Swissre for acquisitions and that has stalled the dividend per share for a couple of years at least despite the fact that the dividend payment has increased significantly in the Company's accounts.
Through an outfit like Primary Bid it is surely not difficult for companies to include their private investors. Obviously a rights issue gives every investor an equal opportunity to contribute but share placings have become very popular especially since Covid as they are cheaper and quicker to achieve.