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Follow-ons and Rights issues

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  • UniCredit's €13bn rights issue, which won rousing applause from investors on Tuesday when the share price rose 16% on its announcement, will be one of the centrepieces of what is likely to be a busier year for financial institutions ECM in 2017.
  • Most ECM practitioners in Asia are set to end 2016 not with a bang but a whimper. But even after such a volatile year, they are heading into 2017 with a rosier view of the market. Given the topsy turvy events of this year, the better strategy would be to err on the side of caution.
  • China First Capital Group is looking to raise up to HK$1bn ($128.9m) from a placement of fresh equity, equal to more than 10% of its outstanding stock.
  • Amundi’s shares closed at a record high on Monday, up 5.4%, after it announced it would use a €1.4bn rights issue and €600m of senior and subordinated debt to buy Pioneer Investments from UniCredit.
  • Hong Kong’s market watchdogs are stepping up enforcement against the misuse of rights issues and open offers that substantially dilute the interests of minority shareholders.
  • Uncertainty surrounds the attempt to recapitalise Banca Monte dei Paschi di Siena, as news media reported today that the European Central Bank had denied its request for an extension of the deadline for it to raise €5bn, until January.