What is a Public Subscription Offer?

The public subscription offering (OPS) is a procedure in which a qualified investor or retail investor acquires public securities of a company.

To make a public subscription offer, the company will need to make a capital increase, where one or more of the shareholders renounce the pre-emptive subscription right and issue new shares before selling them. In this way, the company that sells the shares will retain its shareholder structure to bring in new ones for the purpose of their placement in Stock Exchange.

A public subscription offering is usually more important than a public offer of sale, since the current shareholders have no intention of leaving the company because the intention of the company is to continue its growth and for this it will require capital to face new projects.

Before a PAHO launch, an information brochure must be published before the CNMV or the regulatory body, and this financial event must also be promoted. In general, it will be done through the company's website or even on the Commission's website in the area of ​​relevant events.

Among the information that this brochure should take to a PAHO are:

  • Information about the securities they offer: with characteristics, price and expected profitability.
  • Issuer data: how place of business, administration organ.
  • Details about the issuer's activity.
  • In-depth information on the placement: placement entities, award systems, deadlines, ec.

When an OPS is issued, the message is conveyed that the company wants to make changes and this must be analyzed in detail. It is necessary to study certain variables such as the return on assets, the company's dividend policy and the liquidity of the share, among other things.

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