What is the expected effect of the directed issue of redeemable and convertible class C shares on Sobi's capital structure?

Impact on Sobi’s capital structure

The directed issue of redeemable and convertible Class C shares adds a new, flexible layer of equity that can be turned back into cash (redeemable) or ordinary shares (convertible) at the company’s discretion. Because these securities are initially recorded as equity but are not immediately dilutive, the current share count and voting power stay unchanged. However, the embedded conversion and redemption rights create a latent dilution potential* – if the board later converts the C‑shares into common stock or redeems them for cash, the outstanding common‑share base will expand and the company’s cash‑flow commitments will increase.

Trading implications

• Short‑term: The market will likely view the issuance as a capital‑raising move that strengthens the balance sheet without immediate equity dilution, which can be supportive for the stock in the near term. Expect modest upside pressure, especially if the issue was priced at a discount to the current market level, providing a cushion for price appreciation.
• Medium‑to‑long term: Analysts will monitor the conversion‑redemption schedule. Any signal that the board may convert a sizable portion of the C‑shares (e.g., to fund acquisitions or repay debt) could trigger a dilution‑risk premium and push the price down, while a decision to keep the shares redeemable rather than convertible will limit dilution and preserve the current capital structure. Consequently, the stock’s upside is contingent on the company’s strategic use of the new capital and the timing of any conversion events.

Actionable view

• If you are bullish on Sobi’s orphan‑drug pipeline and the balance‑sheet boost: consider a short‑to‑mid‑term long position (e.g., 3‑6 months) to capture the upside from the strengthened cash position, while keeping a modest stop‑loss (~8‑10 % below current levels) to guard against a sudden conversion‑dilution shock.
• If you are risk‑averse or see a high likelihood of conversion: stay on the sidelines or reduce exposure; a defensive stance (e.g., holding a small position or using protective options) can limit downside if the latent dilution materialises.