FAB proposes one new share for every 9.958 held in Dh15 billion rights issue

A. SREENIVASA REDDY (ABU DHABI)

First Abu Dhabi Bank (FAB) plans to give eligible shareholders one right for every 9.958 shares they hold as part of a proposed Dh15 billion rights issue. Each right will allow its holder to buy one new share at Dh13.52.

“Fractional entitlements will be rounded down,” the bank said in a stock market disclosure. This implies that an eligible shareholder who holds 15 shares on the eligibility date would have a calculated entitlement of about 1.51 rights. This would be rounded down to one right, allowing the shareholder to buy one new share for Dh13.52.

FAB proposes issuing up to 1.11 billion new shares. Of the Dh13.52 issue price, Dh1 per share would go towards increasing the bank’s issued share capital, while the remaining Dh12.52 would be added to its statutory reserve. If fully subscribed, the issue would increase FAB’s share capital from about Dh11.05 billion to Dh12.16 billion.

Shareholders will vote on the proposal at a general assembly on December 7. December 4 is the record date for attending and voting at the meeting. The disclosure did not specify the separate eligibility date for the rights issue or the subscription period.

Shareholders will also vote on whether to authorise the board to proceed with the amount subscribed without offering any remaining shares to the public. The final increase in share capital will be determined after subscriptions close and the Capital Market Authority gives its approval.