Reasons for Companies to Issue Rights Offering
A company can raise capital by providing the right for its existing shareholders. Existing shareholders can subscribe to newly issued shares in proportion to their existing holdings. A company may use this extra capital to meet its current financial obligations.
A right issue of shares (rights offering) is where a company provides an offer to their existing shareholders to purchase additional shares at a discounted price on a particular ratio proportionate to their existing shareholding.
Learn more about Right Issue of Shares,
- What is the Right Issue of Shares?
- Why companies conduct the Right Issue of Shares?
- What is the benefit for the shareholders to subscribe to the Rights Issue of Shares?
- Why should a shareholder be careful about subscribing to a right issue?
- Benefit for the company to conduct the Right Issue of Shares?
- Rights Issue Example
- What Happens to the Share Price after the Right Issue?
- Advantages of Right Issue of Shares
- Disadvantages of Right Issue of Shares
