Unicredit rights issue – update

Tomorrow will be the last trade date for the subscriptions rights. So far, the shares are doing really well. the subscription rights recovered from a low of ~0,45 cents to currently around 2,12 EUR.

This is still well below the theoretical value of 2.29 EUR ((3.09-1.943)*2).

Looking at the relative Performance:

Since the rights started trading (January 9th), Unicredit has outperformed the FTSE MIB by +35% and competitor Intesa by +25%, howver since January 1st, Unciredit has underperformed the MFTSE MIB and Intesa by ~-26%

In the last few days, some good news emerged:

– the Abu Dhabi Sovereign Wealth fund had committed to increase its stake
– Zurich Financial Services seems to be interested in buying part of the Turkish JV

So from a investment point of view, a lot of the forced selling seemed to happen in the first 2 days of the subscription right trading period. I had expected that towards the end the price would come down again but it doesn’t look like that at the moment.

Dispite the significant discount of the rights, I will not start a long/short trade, as a lot of the expected outperformance has already occured in the last few days.

5 comments

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s