Rights Issues Reform Sympsium

20 January 2009

The Rights Issue Review Group (RIRG) has published its report to the Chancellor of the Exchequer on the reform of rights issues. Co-chaired by HM Treasury (HMT) and the Financial Services Authority (FSA) and including representatives from advisers, underwriters, issuers and investors, RIRG was asked by HMT to review the rights issue process in light of the difficulties experienced by some issuers earlier this year. Its recommendations are far-reaching.

RIRG's short-term proposals cover the following areas:

  • Reduction of the rights issue subscription period
  • The appropriate notice period for AGMs
  • Increase in the annual ceiling of allotments of shares for issuers
  • Reinforcement of transparency between issuers and underwriters
  • Introduction of new guidance for issuers on rights issues
  • Consultation on a new form of open offer
RIRG's medium term proposals address the following areas:
  • Potential for the adoption of a short form prospectus for rights issues
  • Increased use of shelf registration for equity issuance
  • Establishing a basis for conditional dealing in rights issues to allow the AGM notice period and the rights issue subscription period to be run in parallel
  • Viability of introducing more accelerated rights issue models, such as the Australian RAPIDS model
  • The FSA reaching a more permanent position in relation to short selling in rights issues
This timely symposium, at which Gary Roberts, Head of Financial Services Strategy at HMT will highlight the key recommendations of RIRG, is being held while these proposals are still out for consultation. So that the views of the conference delegates can be captured and fed into the process, attendees will be given the opportunity to vote electronically on proposals for reform during the course of the day. Stuart Willey, Chief Counsel Markets & Wholesale Firms at the FSA, will outline the way forward and respond to the results of the vote on proposals by conference delegates.

Featuring a speaker panel of exceptional quality, attendance at the symposium will be very useful for issuers, institutional investors, investment bankers, brokers and custodians, as well as the advisory community. 

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