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This q and a explains the key differences between a rights issue and an open offer, which are two means of raising capital for a company. It outlines that both involve offering new shares to existing shareholders, often at a discount. However, in a rights issue shareholders receive tradable rights to subscribe whereas in an open offer there is no trading period so shareholders must participate or lose the benefit of the discount. The document notes other differences like shorter timetables for open offers and the ability to combine them with placings. It also explains compensatory open offers which allow shareholders to get value for unsubscribed shares like in a rights issue. Overall the q and a aims to clarify for legal practitioners how rights issues and open offers work and their relative advantages.
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