What term describes the securities used in additional offerings to purchase available shares, usually at a discount?

The term that describes the securities used in additional offerings to purchase available shares, usually at a discount, is subscription right. This is a special privilege granted to existing shareholders, allowing them the first opportunity to buy additional shares before the company offers them to the public. Subscription rights are typically issued at a price lower than the current trading price of the stock, which incentivizes existing shareholders to purchase more shares and avoid dilution of their ownership.

This mechanism helps maintain shareholder control and gives investors an advantage in capitalizing on the company’s potential growth at a favorable price, which is why it is particularly relevant to additional offerings. Such rights are often structured to allow shareholders to buy new shares proportionate to their existing holdings.

Understanding this concept is essential in the context of investment strategies and shareholder rights, particularly for those involved in corporate finance or investment decisions regarding equity securities.