Today I got the share holders circular regarding DPL rights. They intend to receive 722 Mn from rights and 500 will be allocated to settle the part of current borrowing and balance for modernization of the factory.
However interesting thing is they are going to settle the Non financial loans which are having low interest rate while keeping high interest rate loans.when look at the non financial loans of 777 Mn 499 consist with the loan obtain from it's parent at 1%.
It is purely transfering of money raised from rights to it parent. Is nt it?
And onther interesting thing is their factory modifications then need 270 Mn and for balance company would borrow from financial institutions. ( That mean they settle 1% parent loan and again borrowing from arround 6% from financial institutions ) Very funny storry.
There may be trading opportunity specially from rights but I dont think company would not be abale to turn back with the utilization of rights.
Open for your comments.