Like a rights issue or open offer, it allows shareholders to buy additional shares, usually at a fixed price.

But unlike a rights issue or open offer, you aren’t offered shares in proportion to the number you already own. Instead, you can apply for as many as you’d like (subject to the offer’s terms).

With an offer for subscription, there is usually a minimum level of total applications for the shares to go ahead. If this level isn’t met by the shareholders, the offer can be withdrawn. And if the company receives more applications for shares than are on offer, it may reduce the number of shares it allocates to each applicant.

If a company you have shares in announces an offer for subscription, you’ll be sent a corporate action notification with all the details of this.