answersLogoWhite

0


Best Answer

Unlike a standard rights issue an non-renounceable rights issue is one that cannot be transferred to another investor.

Under a traditional renouncable right issue the holder of the shares as the option to transfer rights to another investor (usually for a price).

This is not an option for a non-renounceable rights issue and the investor has one of two choices

1) Take up the rights

2) Ignore the rights

Neither is necessarily the right option as the decision the investor needs to take depends on why the company has offered the rights in the first place.

User Avatar

Wiki User

14y ago
This answer is:
User Avatar

Add your answer:

Earn +20 pts
Q: What is Non-renounceable rights issue of shares?
Write your answer...
Submit
Still have questions?
magnify glass
imp
Related questions

For the company who had already have IPO mif they want to issue the new shares are they need to make another IPO?

No. A company can issue an IPO only once. They can issue new shares through bonus shares or through rights issues.


Why issue rights issue of shares at a discount?

when shares aree issued at a lower than the face value they are said to be issue of share at discount. the main reason behind issuing share is to attract retailer


Who is entitled to subscribe to a Rights Issue?

Those who held shares at the time of book closure.


How does a company lower their gearing ratio?

Easiest way is to make a Rights issue of shares.


What is Non renounceable rights issue of shares?

Unlike a standard rights issue an non-renounceable rights issue is one that cannot be transferred to another investor. Under a traditional renouncable right issue the holder of the shares as the option to transfer rights to another investor (usually for a price). This is not an option for a non-renounceable rights issue and the investor has one of two choices 1) Take up the rights 2) Ignore the rights Neither is necessarily the right option as the decision the investor needs to take depends on why the company has offered the rights in the first place.


What are the different sources of capital?

· Bank lending· Capital markets· Debenture· Deferred ordinary shares· Franchising· Government assistance· Hire purchase· Loan stocks· New share issue· Ordinary shares· PARTS· Preference shares· Retained earning· Rights issue· Sources of funds· Venture capital· Rights issue· Sources of funds· Venture capital


Advantages and disadvantages of rights issue?

Some advantages to rights issues include the fact that share holders are able to buy additional shares at a lower rate, and by selling these shares, the company is able to pay off some of their debt. Disadvantages of rights issues include stocks that have a reduced value.


How many times can a private corporation issue an IPO?

A company can do an IPO only once. If it wants to issue more shares it can do a Further Public Offering or FPO or do a rights issue etc. But an IPO can be done only once.


What is the difference between equity shares with voting rights and equity shares with differential rights?

Equity shares with voting rights are those shares which have right to vote with dividend where as in differential voting right shares , a shareholder sacrifices a some rate of dividend to get additional voting rights. By divya mittal


What is the maximum number of shares of stock that a corporation can issue over the life of the charter called?

authorized shares are the maximum number of shares of stock that a corporation can issue.


What is the minimum subscription?

When a company offer shares to the public, they offer many shares, however they set a speific amount to be subsribed by the public in order to issue the shares, otherwise they cannot issue the shares.


What is the difference between Bonus Issue and Rights Issue?

Rights Issues are issued to existing shareholders of a company when that company decides to raise more capital via issuing new shares. Existing shareholders are given the "right" to purchase new shares at a discounted price (generally discounted - not always); if they choose not to take this "right" they can instead sell the rights to purchase the shares on a free market to ensure that their net wealth is maintained (as the increase in supply effectively devalues each preexisting share). Bonus issues are generally associated with an investor being issues with extra shares than what they paid for. This can be as means of maintaining net wealth also (redistribution from company held shares to shareholders etc). This is the issue of an actual share that can then be traded on an open market.