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Preemptive Right

What is a Pre-Emptive Right?

#CA2016 #Constitution

Section 85 of the Companies Act 2016 provides that subject to constitution of the company, shareholders have pre-emptive rights to new shares.

Therefore, unless the constitution of the company provides otherwise, or the current shareholders waive their pre-emptive rights, the investor would not be able to subscribe to new shares.

If you are investor looking into investing... Consult your Accountant or us, as the constitution of the company might not be friendly to you.

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