Legal Aspects of Right Issue of Shares by Unlisted Company

When a Company offers its new Shares to its existing Shareholders only it is known as the Right Issue of shares. Right Issue is very convenient and cheapest way to issue Shares. The Right Issue is also known as “Pre Emptive Rights” that means the existing Shareholders have first Right to subscribe or deny in the issue of new shares.

The Shareholder can also renounce their offered shares under Right Issue to any other person in full or in part. Accordingly the Shareholder has following three options under Right Issue of Shares:

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