Hong Kong Exchanges and Clearing Limited (HKEx) announced the arrangements for the adjustment to the contract terms of all open New World Development futures and options contracts in existence after the market close on 21 October 2011 to account for New World Development’s rights issue comprising one share for every two shares held.

Highlights of the adjustment arrangements are shown below.  Investors should consult their brokers for further details, or if they have any questions regarding the adjustment.

New World Development Futures 

Adjustment Procedures 

Adjustments will be made to the open positions which exist after the market close on the business day immediately before the ex-rights day.  Details of the adjustment procedures are as follows:

*Where C is the rights issue price of $5.68; OD is the proposed final dividend of $0.28; and S is the underlying stock closing price on the business day (21 October 2011) prior to the ex-rights day.

Trading of Adjusted and Standard Contracts

After the market close on 21 October 2011, the business day immediately before the ex-rights day, the open positions will be transferred to the adjusted futures contracts.  In addition, new contracts based on the standard contract multiplier will be introduced for trading on the ex-rights day, 24 October 2011.  Details of the adjusted and standard contracts available for trading on and after the ex-rights day are shown below:  

Investors should note that the cash settlement amount of adjusted and standard futures contracts on the last trading day will be calculated using their respective contract multipliers.  There will not be any changes to the number of open positions and other contract terms after the transfer of positions.

New World Development Options

Adjustment Procedures

Adjustments will be made to the open positions which exist after the market close on 21 October 2011, the business day immediately before the ex-rights day.  Details of the adjustment procedures are as follows:

*Where C is the rights issue price of $5.68; OD is the proposed dividend of $0.28; and S is the underlying stock closing price on the business day (21 October 2011) prior to the ex-rights day.Trading of Adjusted and Standard Contracts

After the market close on 21 October 2011, the business day immediately before the ex-rights day, the open positions will be transferred to the adjusted option series.  In addition, new option series based on the standard contract size will be introduced for trading on the ex-rights day, 24 October 2011.  Details of the adjusted and standard contracts available for trading on and after the ex-rights day are shown below:

Investors should note that the adjusted and standard option series have different contract sizes.  There will not be any changes to the number of open positions and other contract terms after the transfer of positions.

Ends