What does it mean that there is a pre-emptive right for existing shareholders in a rights offering?
A rights offering with pre-emptive rights for existing shareholders is a type of rights offering where a company’s shareholders as of a defined day (the record date) are given the primary right to subscribe for new shares. The shareholding on the record date will determine how many shares a shareholder has the pre-emptive right to subscribe for. The pre-emptive right is represented by subscription rights.
