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Shareholders
Shareholders
at a specified (usually discounted) price. Its objective is to afford them the opportunity to
maintain their percentage of ownership of the firm. See also scrip issue.
Rights Issues are Corporate Actions Events whereby a company seeks to increase its
capital by issuing new securities.
Existing shareholders need to be given a chance to maintain their stake in the company to
prevent dilution.
The rights are securities just like shares and can be listed on a stock exchange.
Rights can be exercised to subscribe to new securities during the exercise period.
On the paydate of the event, the shareholder who exercised the rights will receive the
resulting securities and will pay the company the exercise price per share.