Module III· ECM — Follow-on, ABB, Rights IssueAdvanced
Question

When does an issuer use a rights issue instead of an ABB?

Answer

Use a rights issue for large capital raises, balance-sheet repair, highly dilutive needs, or where pre-emption rights and shareholder fairness are critical. Use ABB for smaller, faster placements where legal capacity exists and investor demand can be built quickly. Rights issues suit transformational funding; ABBs suit speed and tactical capital.