Olam International

[CityFarmer]

Wasn't expecting a debate on the entity aspect of a company when I brought up the point on the cost of the right issue to Olam. It was more to give credit to the company (or management) as this right issue isn't as lousy or hastily decided as what critics such as Michael Dee suggested.

Moving on, for the company in the next few years, the actual financial cost is 6.75% only, and during the bond maturity, the company can have the option to do a rights or shares placement to repay these bonds if they and the shareholders want to.

Ultimately, if we look at the bigger picture, yes there will be dilution here and there for minority shareholders.. but if Olam follows Michael Dee's suggestion and raise equity now, the effect might be worse for minority shareholders.

Without a definition of "the company", we may discuss on different issue

Let's define "the company" means the shareholders

First of all, it is 8% instead of 6.75%. The bonds is priced at 95 per cent of the principal amount.

Right issue is difference from placement. If shareholders (includes the minority) opt for full rights, there will not be dilution.