Ryman’s non-participating shareholders get screwed in its $1b cap raise

Ryman’s Deborah Cheetham village at Ocean Grove in Victoria, one of eight villages still under construction. Source: Ryman.

One fact about Ryman Healthcare’s $1 billion capital raising is that retail shareholders who can’t or don’t want to participate are getting right royally screwed.

To begin with, the discount is huge – the $3.05 offer price per share is $1.25, or 29.2%, lower than where the shares closed on Friday and is also $2.847, or 48.3%, below net tangible asset (NTA) backing of $5.897 at Sept 30 last year.

After the issue, the pro forma NTA drops to $4.95 while the theoretical ex-rights price is $3.90.

The number of new shares being sold is about 328 million, about 48% of the existing 687.6 million shares on issue, so non-participating shareholders’ stakes will be left with roughly two-thirds of their previous position.