Preemptive Right

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Preemptive Right

The privilege of a stockholder to maintain a proportionate share of the ownership of a corporation by purchasing a proportionate share of any new stock issues.

In most jurisdictions, an existing stockholder has the right to buy additional shares of a new issue to preserve Equity before others have a right to purchase shares of the new issue.

preemptive right

n. the right of a shareholder in a corporation to have the first opportunity to purchase a new issue of stock of that corporation in proportion to the amount of stock already owned by the shareholder. (See: corporation, stock)

References in periodicals archive ?
A preemptive right, or right of first refusal, does not give its holder the power to compel an unwilling owner to sell; it merely requires the owner, when and if he decides to sell, to offer the property first to the party holding the preemptive right so that he may meet a third-party offer or buy the property at some other price set by a previously stipulated method.
22 July 2011 - Norwegian fertiliser maker Yara International ASA (OSL: YAR) is considering using its preemptive right to buy Oswal family's 65% stake in Australian joint venture Burrup Holdings, Yara spokesman Asle Skredderberget, told Norwegian news source iMarkedet Xpress on Friday.
22 percent fully paid shares subject of the instant petition, with all dividends declared, paid or issued upon thereon, as well as any increments thereto arising from, but not limited to, the exercise of preemptive right, shall be reconveyed to the government of the Republic of the Philippines, which as we previously clarified, shall be used 'only for the benefit of all coconut farmers and for the development of the coconut industry.
Norwegian chemical group Yara International (OSL:YAR) is mulling over the possible use of its preemptive right to acquire the 65% in Australian joint venture Burrup Holdings owned by the Oswal family, a spokesperson for Yara told news source iMarkedet Xpress today.
The remaining shareholders in Ariconsult have a two-month preemptive right period to buy the shares.
acents Inter RAO starts additional issue placement under preemptive right.
HEAG Holding, which holds 53% of HSE, has a preemptive right to acquire E.