Cash box placing: Difference between revisions
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The advantage of a cash box placing is that it allows the issuer to claim exemption from the pre-emption rules which would apply to a direct issue of ordinary shares for cash. | The advantage of a cash box placing is that it allows the issuer to claim exemption from the pre-emption rules which would apply to a direct issue of ordinary shares for cash. | ||
The mechanism which allows the placing to qualify as an issue for non-cash consideration is the exchange of the new ordinary shares issued, for preference shares in the cash box subsidiary. These preference shares are funded, in turn, by the proceeds to the facilitating investment bank of the placing of the issuer's ordinary shares. | The mechanism which allows the placing to qualify as an issue for non-cash consideration is the exchange of the new ordinary shares issued, for preference shares in the cash box subsidiary. These preference shares are funded, in turn, by the proceeds to the facilitating investment bank of the placing of the issuer's ordinary shares. | ||
Not to be confused with a Cash placing, which is different. | Not to be confused with a Cash placing, which is different. | ||
== See also == | == See also == | ||
Revision as of 13:59, 6 May 2016
Corporate finance.
A type of placing which enables an issuing company to receive cash indirectly - via a 'cash box' subsidiary company.
The advantage of a cash box placing is that it allows the issuer to claim exemption from the pre-emption rules which would apply to a direct issue of ordinary shares for cash.
The mechanism which allows the placing to qualify as an issue for non-cash consideration is the exchange of the new ordinary shares issued, for preference shares in the cash box subsidiary. These preference shares are funded, in turn, by the proceeds to the facilitating investment bank of the placing of the issuer's ordinary shares.
Not to be confused with a Cash placing, which is different.
