Corporate Actions

Capital Reduction

Definition

What is Capital Reduction?

A formal decrease in a company's share capital under applicable law.

Example in practice

A company cancels accumulated losses against share capital as part of a capital reduction.

Keep learning

An offer allowing existing shareholders to buy additional shares, usually in proportion to their holdings.

An issue of additional shares to existing shareholders without a cash payment.

An increase in the number of shares accompanied by a proportional reduction in price per share, leaving total value initially unchanged.

A vote cast by another person or electronically on behalf of a shareholder.

Think you know your investing terms?

Put your knowledge to the test with a quick quiz.