Match the following.
| 1. | Offer for Sale | A. | Privilege given to existing shareholders to subscribe to a new issue of shares |
| 2. | Private Placement | B. | Securities are issued through intermediaries like stockbrokers etc. |
| 3. | Rights issue | C. | Issuing capital to the public through online system of stock exchange |
| 4. | e-IPOs | D. | Allotment of securities to institutional investors and some selected individuals |
Answer & explanation
Correct answer: option 3
Offer for Sale: Under this method securities are not issued directly to the public but are offered for sale through intermediaries like issuing houses or stockbrokers.
Private Placement: Private placement is the allotment of securities by a company to institutional investors and some selected individuals.
Rights issue: This is a privilege given to existing shareholders to subscribe to a new issue of shares according to the terms and conditions of the company.
e-IPOs: A company proposing to issue capital to the public through the on-line system of the stock exchange has to enter into an agreement with the stock exchange. This is called an Initial Public Offer (IPO).