Open offer definition
What does Open offer mean?
A buyer may raise capital for an acquisition from a further offer of its equity securities. This may take the form of a pre-emptive offer to its existing shareholders either through an open offer or a rights issue. An open offer is similar to a rights issue, pursuant to which shareholders are entitled to subscribe in cash for newly issued shares in proportion to their existing holdings. Unlike a rights issue, the shareholders have an entitlement rather than a tradable right to subscribe for new shares, so that they will not be allowed to sell the right to subscribe for the shares if they decide not to take up the offer.