Rights Issues

What is a Rights Issue?

A rights issue, also known as a rights offering, is a method used by a company to raise additional capital from its existing shareholders. It is a way for a company to offer its shareholders the opportunity to purchase additional shares in proportion to their existing holdings and generally at a discounted price determined by the company.

It is important to note that the specific details of a rights issue, including the subscription price, the number of shares offered, and the timeline for the offering, are determined by the company and are subject to approvals by relevant governing bodies.

To find the latest news and updates on rights issues on our website, select Quotes & Research > Company > Announcements.

Rights Issue Illustration

What are Renounceable Rights?

Renounceable rights provide existing shareholders the opportunity or the right to purchase new shares at a pre-determined price and in proportion to their current holdings. The rights issued can be freely traded in the market as long as they are still valid (i.e., the rights are available until expiry on a specified date).

Shareholders who hold renounceable rights are provided with 3 options:

  1. Exercise: the option to use or exercise the rights by purchasing new shares before the application close date.
  2. Sell: the option to sell the rights in the market, please ensure they are still valid and follow the normal trading process.
  3. Lapse: the option to do nothing with the rights and let them expire on the indicated date.

What are Non-Renounceable Rights?

Non-renounceable rights provide existing shareholders the opportunity or the right to purchase additional shares generally at a discounted price. The rights issued cannot be transferred or traded on the market.

Shareholders who hold non-renounceable rights have 2 options:

  1. Exercise: the option to use or exercise the rights by subscribing to the new shares.
  2. Lapse: the option to do nothing with the rights and let them expire on the indicate date.

To find more information on renounceable or non-renounceable rights, how to exercise rights, application costs, or purchased rights, please contact the relevant share registry of the company. Refer to our educational article on ‘Where to find share registry details’ here.

This information is intended to provide information for educational purposes only and is subject to change at anytime without notice.