The correct answer is: A. By issue of prospectus
A prospectus is a document that is used to provide information about a company to potential investors. It includes information about the company’s business, its financial condition, and the risks associated with investing in the company. A prospectus is required to be filed with the Securities and Exchange Commission (SEC) before a company can offer its securities for sale to the public.
A rights issue is a type of equity offering in which existing shareholders are given the opportunity to purchase additional shares in the company. This is done by issuing new shares to existing shareholders at a discount to the market price. Rights issues are often used by companies to raise capital to fund expansion or to repay debt.
A stock exchange placing is a type of equity offering in which shares are sold to institutional investors, such as pension funds and hedge funds. This is done through a broker or investment bank, and the shares are not offered to the public. Stock exchange placings are often used by companies to raise capital quickly and without the need to file a prospectus with the SEC.
A private placing is a type of equity offering in which shares are sold to a small number of investors, such as family and friends. This is done directly by the company, and the shares are not offered to the public. Private placings are often used by companies to raise capital early in their development, when they may not be able to meet the requirements for a public offering.
In conclusion, the correct answer is: A. By issue of prospectus. A prospectus is a document that is used to provide information about a company to potential investors, and it is required to be filed with the SEC before a company can offer its securities for sale to the public.