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New IPO shares from First Capital Realty Inc. (FCR)

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  • May 17th, 2016 1:59 pm
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[OP]
Deal Addict
Sep 5, 2010
2347 posts
370 upvotes
Toronto

New IPO shares from First Capital Realty Inc. (FCR)

I got a notification from RBC DI about a new IPO from FCR at a price of $21.10 CAD per share.

The release also notes: [QUOTE]Please be advised that if you participate in this new issue offering, RBC Direct Investing will receive a selling concession equal to $0.42 per share.
[/QUOTE]


I looked up the price of FCR and at the moment it is sitting @ $20.78


So the obvious question here is: why should I pay $21.10 (plus the $0.42 to RBC DI when selling) for the new stocks, when I can simply get them for the existing price of $20.78? I know the current price fluctuates and could go higher than the new IPO price, but still, I would think it makes more sense to try to price it as close as possible to the current price?
My Signature is empty. My signature space is not for sale. You may not contact me to advertise your RFD-related activities here. I repeat, this signature-space is not for sale, unless it is a ......day
5 replies
[OP]
Deal Addict
Sep 5, 2010
2347 posts
370 upvotes
Toronto
Never mind, I just saw this in the same release:
" This is a bought deal for common shares at $21.10. The new issue shares are sold at a 2.2% discount to the last reference price of $21.58. Based on the annual dividend of $0.86/share, the new issue shares have a yield of 4.1%. "
But still, the last reference point is now '20.78' , but I understand this is a moving target and it is hard to get an accurate price. Imagine if FCR was even lower today , below $20?
My Signature is empty. My signature space is not for sale. You may not contact me to advertise your RFD-related activities here. I repeat, this signature-space is not for sale, unless it is a ......day
Deal Addict
Mar 22, 2010
3266 posts
1083 upvotes
I passed when I saw 2.2% discount...
[OP]
Deal Addict
Sep 5, 2010
2347 posts
370 upvotes
Toronto
Speaking of this stock, does anyone own it or know much about it? its dividend is not too bad (4.41% yield) , so I would look into it just for that alone.
My Signature is empty. My signature space is not for sale. You may not contact me to advertise your RFD-related activities here. I repeat, this signature-space is not for sale, unless it is a ......day
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Sep 19, 2004
25228 posts
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where I belong
Supply & Demand

I'd pass too since you can buy on open market
usually stocks drop right to the new offer price, or below (like H or even BCE)
Some actually go UP, like ENB

Looking at last night's new offers
KEY +1.5% (I asked 500, got 300 total, 4% yield too)
TOY -7%
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