A corporate action is an event announced by a corporate entity that usually results in material changes to the security issued by the company, or involve a cash consideration. In practice a corporate action refers to a broad spectrum of activities undertaken
by companies and which have a significant influence on its security holders. A corporate action will usually be decided upon by the company's board of directors and require regulatory or investment holder approval. Corporate actions include name changes,
dividend or coupon distributions, mergers and spin-offs, liquidations and many others. Some corporate actions such as takeovers, bonus issues, rights issues and stock splits affect the number of shares in issue: these actions will generally change
the number or percentage of a company's shares you hold. Some corporate actions are mandatory, as they are applicable to all holders of a certain security, while others are voluntary, as they give security holders the option to take or not to take
part to the corporate action.
When a company announces a bonus issue, security holders will receive additional securities free of payment from the issuer in proportion to their holding. Usually bonus issues are undertaken to convert profits which the company has retained into share
Capital gains distribution
This refers to the distribution of profits resulting from the sale of company assets.
Distribution of cash to shareholders, in proportion to their equity holding. Ordinary dividends are recurring and regular.
Scrip Dividend option
Distribution of a dividend to shareholders, where the shareholder can opt whether to receive this dividend in shares, cash or a combination of both.
This is the date when an equity or bond starts trading without a recently announced dividend or coupon. Before the ex-date, the buyer of the equity or bond is entitled to the recently announced dividend or coupon, while after the ex-date the seller will
be entitled to the dividend or coupon.
An offer by the company to give securities and/or cash in exchange for another security.
Forward stock split
This refers to instances where a company’s number of outstanding equities increase (spilt), without any change in the shareholder's equity or the aggregate market value, at the time of the split.
In a merger, two or more companies join to form a new company. Existing shareholders of merging companies typically receive shares of the new company in proportion to their current shareholding.
The date on which a declared event is scheduled to be paid.
This refers to a form of open or public offer where, due to a limited amount of securities available, priority is given to existing shareholders.
The cut-off date established by a company in order to determine which shareholders are eligible to receive a dividend.
This is an offer to existing shareholders by the issuing company to repurchase securities, with the aim of reducing the number of outstanding shares.
Return of capital
A return of capital occurs when a company makes a cash payment to all its shareholders, of a proportion of the value of their shares. Upon payment of this cash, the value of the share is reduced by the rate per share paid
Reverse stock split
This refers to the decrease in a company's number of outstanding shares without any change in the value of shareholder's equity or the aggregate market value at the time of the split.
This refers to the distribution of a security or privilege that gives the holder an entitlement (or right) to take part in a future event. A company may offer its current shareholders the right to buy new shares in the company, at a discount on the current
Share premium dividend
A cash amount paid to shareholders from the shares premium reserve. This is similar to a dividend but with different tax implications. Upon payment of a share premium dividend, the value of the share may be decreased by the rate per share paid.
A spin-off involves taking a part of a company, usually a contained business unit with its own management structure, and creating a new company that contains only that part. Shareholders of the parent company receive shares of the new subsidiary without
having to surrender their shares in the parent company.
An offer made to shareholders, normally by a third party, to sell (tender) or exchange their shares. The term also refers to the process whereby shareholders submit their shares or securities to a takeover offer.
This is offered to shareholders where they are given the right to buy ordinary shares in the company, at a set price and at a future date. Warrants will have an exercise price, which is the price to be paid in order to convert a warrant into an ordinary