CMB warrant issuance approved
(chinadaily.com.cn)Updated: 2007-06-20 18:15 The issuance of the China Merchants Bank (CMB) put warrant, jointly created by 15 securities brokerages, got go-ahead today, according to an announcement from the Shanghai Stock Exchange. It's China's largest ever put warrant created by securities firms.
The put warrant, which totals 1.227 billion shares, will cost 3.2 billion yuan (US$420.06 million) based on yesterday's exercise price. Its number of shares will account for one third of the total CMB put warrants currently in circulation.
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The CMB put warrant will expire on September 1, with an exercise price of 5.48 yuan, far below the current 24 yuan. It means that unless CMB's share price falls 80 percent in the next two months, will such put warrants become worthless.
CMB put warrants ended at 2.59 yuan per share yesterday, down 6.9 percent from the previous day's closing, with a 268.4 percent turnover rate.
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