WE refer to Denis Distant's letter to the editor, " F& N Capital Reduction Debatable" (BT, Oct 3).

We believe that most investors would be aware that in the event of a payment of a significant dividend, the share price of a company is expected to adjust by the amount of the dividend when the shares trade ex-dividend, and shareholders do not suffer any additional loss in value arising from the dividend payment.

Similarly, in the case of a capital reduction through a share cancellation, the share price for the remaining shares that are not cancelled is expected to adjust accordingly to take into account the reduced number of shares when the shares trade ex-entitlement to the capital reduction, such that there is no net value lost to shareholders.

Hence, we do not share Mr Distant's view that Thai Beverage Public Company Limited (" ThaiBev" ) and TCC Assets Limited (" TCC" ) would be making a " 38 cent loss per share on a third of their 438 million shares" through the capital reduction, as the value of the remaining two-thirds of the shares would probably have adjusted such that there is no net difference between the market value of shares before the capital reduction and the sum of the cash distribution plus the market value of remaining shares after the capital reduction.