Rights and wrongs.

Investors Chronicle, August, 2006

The British love their rituals - think of all that stuff such as Trooping The Colour, The State Opening of Parliament and dishing out Maundy money. And maybe it's because we cling to pointless ritual that, in the capital markets, we cling to rights issues as a way for companies to raise money. In most of the developed world, rights issues have been put to sleep. In the UK, they continue to potter along - hardly a vital force, but not quite ready for the final trip to the vet.

This is not to deny that rights issues have their uses. Despite their expense and time-consuming nature, they do protect shareholders' interests. It's no fun to wake up one morning and find that the bosses of a company in which you thought you had a 10 per cent interest have issued enough...

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