exactly. its rich rangers fan investing in the club, it dilutes the shares but who gives a fck? Only celtic fans seem distressed that the shares are being diluted. Only if you invested in Rangers for a profit would it be a concern, otherwise great to see our directors are fans and not investors.
It doesn't dilute anything. An issue of shares at the correct value does not affect the value of any individual share. It will result in you (a person not taking new shares in the issue) having a smaller % holding of the total, but the value of the company in total increases in proportion to the increase in shares.
Example:
There are 10 shares in a company valued at £1 each. Total company assets are £10 in the bank. If you own 2 shares you have 20% of the company and a value of 2 x £1 = £2
The company issues another 5 shares to an individual (not you) at a price of £1 each
There are now 15 shares in the company. But there is also now £15 in the bank.
Your shareholding is now only 2/15 = 13.3% but the shares are still worth £1 each because there is £15 in the bank divided by 15 shares. So your 2 shares are worth 2 x £1 = £2 still. You have not lost any value.
All that's happened is more shares of a bigger pie
It's a slightly different calculation with loan conversion to equity but it amounts to exactly the same thing.
The only time you would suffer a "dilution" would be if the new shares were issued at less than their actual value (say 20p if we agree that 25p is the correct value). That is where the individuals buying the new shares would benefit at your expense.
IMO this is why shares were issued at 20p earlier to repay some loans - effectively giving them an interest payment for the risk capital they had put in. And not unreasonable to my mind.
Hope this helps some non-financial bears out there