@nailsnglue I think you need to incorporate the fact that by buying the rights you are then entitled to buy shares in the fund manager as well, not just the LIC, hence the reason they are trading at circa 20c.
here is the deal as I understand it:
buy rights today at circa 20c
those rights grant you the ability to buy shares in the LIC at $2.34, current NTA is $2.39 but that will be diluted slightly by the new shares so approx $2.37.
by investing in the new shares issued by VG1 you then have the ability to by shares in the VG1 Manager IPO on the basis of $1 for every $4 invested in the new LIC shares
my workings are:
buy 1,000 20c rights puchased today = $200
buy 1,000 VG1 LIC newly issued shares @ $2.37 = $2,370
buy shares in VG1 manager IPO on a 1/4 basis = $2,370 / 4 = $592.50
total outlay = $3,162.50
end result is:
own 1,000 VG1 shares say at NTA of $2.37 = $2,370
assume a 50% increase in the value of the manager IPO shares = $1,185
total value = $3,555
the key is to figure out what the new VG1 manger shares will trade at, factors to consider for mine are.....much lower multiple than peers / high level of performance fees in prior years results / excellent history / additional funds under management with this raising / performance fees have been achieved for the period ended 30/4/19.
as they said in the conference call the paperwork is confusing.
(20min delay)