Hong Kong Exchanges and Clearing Limited (HKEx) announced the arrangements for the adjustment to PICC Property and Casualty Co. Ltd. (PICC Property and Casualty) structured products, futures and options to account for PICC Property and Casualty's proposed rights issue.
Highlights of the adjustment arrangements are set forth below. Investors should consult their brokers for further details, or if they have any questions regarding the adjustment.
|
Underlying Stock (Stock Code) |
PICC Property and Casualty Co. Ltd. (2328) |
|
Corporate Action |
0.9 Rights Shares for every 10 existing Shares |
|
Subscription Price |
$7.46 |
|
Ex-rights date |
10 November 2014 |
For details of the proposed rights issue, please refer to the announcement made by PICC Property and Casualty on 4 November 2014.
Structured products with shares of PICC Property and Casualty as underlying asset
The listing documents of all existing structured products with the shares of PICC Property and Casualty as underlying asset contain provisions that deal with a rights issue. Structured product issuers will make announcements in the evening of 7 November 2014 regarding the relevant adjustments (including the adjusted entitlement and adjusted exercise price as appropriate) and investors should read carefully the contents of such announcements.
PICC Property and Casualty Futures
Trading Arrangements
The trading arrangements for the existing PICC Property and Casualty stock futures under trading symbol PIC will be as follows:
| 1. |
Adjustment and Transfer of Outstanding Positions Open positions of PICC Property and Casualty stock futures series under trading symbol PIC which exist after the market close on the business day immediately before the ex-rights date will be adjusted and transferred to stock futures series under trading symbol PIA. |
| 2. |
Introduction of New Stock Futures Series for Trading On the ex-rights date, new PICC Property and Casualty stock futures series based on the standard contract size will be introduced for trading under the standard trading symbol PIC. |
Details of the adjustment procedures are as follows:
|
Adjustment Term |
Formula |
Remarks |
|
Adjustment Ratio (AR) |
10 old shares + (0.9 new shares x $7.46 / $S*) |
Rounded to the nearest |
|
Adjusted Contracted Price (ACP) |
Contracted price of outstanding futures contract x AR |
Rounded to the nearest |
|
Adjusted Contract Multiplier (ACM) |
Contracted price of outstanding futures contract x |
Rounded to the nearest |
| * |
Where $7.46 is the subscription price for the new shares and $S is the underlying stock closing price on 7 November 2014 (the business day immediately before the ex-rights day). |
|
Contract |
Trading Symbol |
Contract Multiplier(Shares) |
Availability For Trading |
Addition of New Stock Futures |
|
Adjusted |
PIA |
ACM |
From ex-rights date to |
No |
|
Standard |
PIC |
2,000 |
From ex-rights date onwards |
YesPICC Property and Casualty Options |
Trading Arrangements
The trading arrangements for the existing PICC Property and Casualty stock option under trading symbol PIC will be as follows:
| 1. |
Adjustment and Transfer of Outstanding Positions Open positions of PICC Property and Casualty stock option series under trading symbol PIC which exist after the market close on the business day immediately before the ex-rights date will be adjusted and transferred to stock option series under trading symbol PIA. |
| 2. |
Introduction of New Stock Option Series for Trading On the ex-rights date, new PICC Property and Casualty stock option series based on the standard contract size will be introduced for trading under the standard trading symbol PIC. |
Details of the adjustment procedures are as follows:
|
Adjustment Term |
Formula |
Remarks |
|
Adjustment Ratio (AR) |
10 old shares + (0.9 new shares x $7.46 / $S*) |
Rounded to the nearest 4 decimal places. |
|
Adjusted Exercise Price (AEP) |
Exercise price of outstanding option series x AR |
Rounded to the nearest 2 decimal places |
|
Adjusted Contract Size (ACS) |
Exercise price of outstanding option series x |
Rounded to the nearest 4 decimal places |
| * |
Where $7.46 is the subscription price for the new shares and $S is the underlying stock closing price on 7 November 2014 (the business day immediately before the ex-rights day). |
|
Contract |
Trading Symbol |
Contract Size(Shares) |
Availability For Trading |
Addition of New Stock Option |
|
Adjusted |
PIA |
ACS |
From ex-rights date to |
No |
|
Standard |
PIC |
2,000 |
From ex-rights date onwards |
Yes
|
Investors should note that the adjusted and standard option series have different contract sizes. There will not be any changes to the number of open positions and other contract terms after the transfer of positions.
