Housebuilders resort to two-for-one offers
If you’d bought £100 of Taylor Wimpey shares and £100 of Barratt shares this time last year, your £200 would now have turned to £32, Taylor Wimpey accounting for £18 of that sum.
Earlier this week its shares hit a 15-year low of 83p. As one analyst grimly pointed out: “It’s as if the housing boom of the last decade had never happened.”
Barratt was also firmly in the sights of investors as rumours of a rights issue persisted. Its shares were trading 26% down on the week at 156p.
Elsewhere, fellow housebuilder Oakdene was forced to sweeten the terms of its very real rights issue. It had hoped to raise £10m by issuing shares at 50p each. Alas, they’re currently trading on the open market at 46p, which may explain why it's only raised £5m so far.
Subscribers can now purchase a second share at 50p a year from now for every share bought today. Which is only a good deal should the share price go up, of course.