Rights issue versus capital increase with large SHs

[tol1]

Hey,

 

A company is likely to raise equity in a large amount (30% of market cap) and has 1 large shareholder (20%) on its register. A few questions please:

 

- How does a company decide whether to do a rights issue or a capital increase? Can the large shareholder block either?

- Does the discount of either to the current share price differ?

- How much is a usual discount in both processes?

- A 3-for-10 rights issue implies the share count increases by 30%. Does that mean that the EPS automatically decreases by 30% at the same time?

 

Thank you

[tol1]

Appreciate if anyone has some practical knowledge in this equity capital markets area. Thanks