Wiwynn (6669), an AI server manufacturer, has announced the timetable for its ex-rights distribution tied to last year’s earnings-to-capital increase. The board set Sept. 2 as the ex-rights trading date, with a stock dividend of about NT$19.83 per share. Based on the adjusted ratio, each share will receive about 1.983 shares, or roughly 1,982.79 shares for every 1,000 shares held.
Because the allotment ratio is close to 1.983 shares per share, the article described it as roughly equivalent to “buy one board lot and get nearly two more.” Post-distribution holdings would expand to nearly three board lots. With Wiwynn’s share price at NT$7,200, many retail investors have bought in odd lots, putting the treatment of fractional entitlements in focus.
Key dates for the ex-rights process
- Ex-rights trading date: Sept. 2
- Deadline to buy or hold shares to qualify: before the market close on Sept. 1
- Last transfer date: Sept. 3
- Book closure period: Sept. 4 through Sept. 8
- Ex-rights record date: Sept. 8
- Convertible bond conversion suspension: Aug. 14 through Sept. 8
How fractional shares will be handled
The company said the adjusted allotment ratio makes it easy for investors to end up with fractional shares of less than one full share. Its announcement laid out three methods for handling them.
- Shareholders may combine odd lots by registering with Wiwynn’s share registrar within five days from the start of the book closure period, or from Sept. 4 to Sept. 8.
- If no combination is arranged, or if a fractional balance remains after combination, cash will be paid at the stock’s par value of NT$10 per share, rounded down to the nearest NT dollar. The amount will be used to offset postage or related processing fees generated by the stock distribution.
- Any remaining fractional shares after the cash conversion process will, under the rules, be subscribed by a designated party arranged by the chairman at par value.
ABMedia added that after calling Yuanta’s share agency desk, the writer was told investors must find others themselves to combine holdings into full shares. Otherwise, the leftover fraction would be treated as waived, and no cash would be paid.
Reference price adjustment on the ex-rights date
On the ex-rights date, the opening price will be adjusted using the ex-rights reference formula: previous day’s closing price ÷ (1 + share allotment ratio). The article noted that although investors will hold more shares after the stock dividend is distributed, their total book value on the first ex-rights trading day remains the same as before the adjustment. What happens after that depends on the company’s operating fundamentals and the market’s willingness to fill the rights gap.
What odd-lot investors are weighing
The article said views differ on whether investors should sell before the ex-rights date and buy back later, or add shares first to reduce the effect of lost fractions. It also said the smaller the holding, the larger the impact from fractional entitlements. If Wiwynn rises 3% to 5% after going ex-rights, that could help offset the loss, according to the article.