Rights issue - An invitation to existing shareholders to purchase additional shares in the company.
An offer made by a quoted company to its shareholders to enable them to buy new shares in the company at a discount to the market price.Existing shareholders are usually offered shares in proportion to their existing holding. For example in a one for five rights issue, a shareholder would be invited to buy one new share for every five shares already owned. The new shares are offered at a discount to the current market price and because of that the rights have a value in themselves and can be separately sold.For capital gains purposes, the shares acquired following a rights issue are deemed to have been acquired at the same time as the original shares.Shareholders who hold a company"s shares in a PEP, ISA or SIPP account can only take up their rights if they have sufficient funds in those accounts to exercse the rights.
Rights issue : an invitation to existing shareholders to purchase additional shares in the company.
an offer made by a quoted company to its shareholders to enable them to buy new shares in the company at a discount to the market price.existing shareholders are usually offered shares in proportion to their existing holding. for example in a one for five rights issue, a shareholder would be invited to buy one new share for every five shares already owned. the new shares are offered at a discount to the current market price and because of that the rights have a value in themselves and can be separately sold.for capital gains purposes, the shares acquired following a rights issue are deemed to have been acquired at the same time as the original shares.shareholders who hold a company"s shares in a pep, isa or sipp account can only take up their rights if they have sufficient funds in those accounts to exercse the rights.
Rights issue