Yesterday, the KQ share closed at Ksh 13.95 per share. This is 5 cents below the rights issue price. This is similar to the trend that was observed last week where the share was consistently below Ksh 14 and reached a 12 month low of Ksh 12.55 per share.

This begs the question; Wouldn’t a shareholder rather buy extra shares at the market price of Ksh 13.95 than at the rights price of Ksh 14 per share?

Should the share keep trading below the rights price then obviously it would be cheaper to buy from the market without the restriction of 16 new shares for every 5 held.