Macquarie International Warrants are ASX-traded warrants, which offer investors the opportunity to gain exposure to the overseas listings of certain Dual Listed Companies, including the LSE-listed Rio Tinto Plc (RIO UK) and BHP Billiton PLC (BHP UK).
|Security and term||
Macquarie International Warrants are quoted on ASX and have a term of approximately five years:
Maturing 31 October 2014:
Maturing 10 December 2014:
|Transaction and Structure||The exercise or strike price will be set at AUD0.01, and the Warrants are expected to trade at approximately the AUD equivalent of the price of the relevant underlying UK listed Reference Share.|
Macquarie Investment Warrants provide the opportunity for investors to potentially take advantage of any spread differentials between BHP and RIO AU and BHP and RIO UK.
For example, a reduction in the spread may imply that, for example, BHP (UK) would rise in price relative to BHP (AU) or that BHP (AU) would fall in price relative to BHP (UK). Purchasing a Macquarie International Warrant over BHP (UK) or RIO (UK) gives investors the opportunity to gain in relation to any increase in the price of BHP (UK) or RIO (UK) (subject to movements in the applicable exchange rate).
More detailed information about DLC spreads can be provided on request.
|Pricing||Investors should contact Macquarie for firm Warrant pricing.|
|Settlement||T+3 settlement. Similar to stock positions.|
At maturity, Macquarie International Warrants will be physically settled which means that investors will be entitled to receive a number of ASX securities (the Deliverable Shares). The Deliverable Shares are likely to be the ASX-listed BHP Billiton Ltd (for BHP UK) Warrants and RIO Tinto Limited (for RIO UK Warrants). The number of Deliverable Shares received will depend on the AUD equivalent of the volume weighted average price of the UK Reference Share on each of the five averaging days following the maturity of the Warrant (Final Value) and the price of the AU listed Deliverable Share following the determination of the Final Value of the Warrant. For example if an investor holds 5 BHP UK Warrants worth $A20 each and BHP AU is trading at $A25, they will be delivered 4 BHP AU shares.
Note that investors will be provided with the opportunity to sell out of their International Warrants on market before maturity.
|Upfront||During the investment||At maturity|
Before making any investment decision, it is important that you consider the risks of an investment in Macquarie International Warrants. More information about some of the significant risks of investing in Macquarie International Warrants is set out in the Product Disclosure Statement. You should discuss the risks of investing in Macquarie International Warrants with your professional advisers.