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 ?
Metrobank had previously disclosed it will raise up to P60 billion through this stock rights offering, proceeds from which will enable the bank to pursue business prospects and sustain its strong growth trajectory.
8bn worth of debt and will further reduce its debt by another PHP5bn using the proceeds of the PHP15bn stock rights offering.
Example 1: An investor owns stock in a company and receives a distribution of stock rights to purchase additional shares at $36 per share.
the period for substituting nondiscounted Stock Rights for discounted Stock Rights (although there can be adverse consequences to participants if the substitution of vested rights does not occur until 2006).
Poison pills" are contingent stock rights that are incorporated into a stock certificate or distributed as a dividend, which serve to enable a corporation to defend itself against an unsolicited tender offer.
Stockholders will not be required to do anything to convert their Insituform shares and the accompanying preferred stock rights to Aegion shares and preferred stock rights.
RCBC president Gil Buenaventura said the proposed stock rights offering would complement the bond offering.
5-million stock rights offering by the PSE that the exchange claims would dilute the brokers' ownership down to 20 percent.
The Philippine Stock Exchange (PSE)will be launching its stock rights offering of February 26, 2018 after setting the offering price and entitlement ratio on February 9.
PERC) of the Yuchengco Group has successfully completed its stock rights offer, raising around P758.
M2 EQUITYBITES-December 30, 2015-Empire Resorts declares common and preferred stock rights offering
RCBC said that it would pursue the stock rights offer in January if the deal with Cathay Life isn't completed by the end of December.