Secondary offerings

Companies that have gone public may later make further issues of stock to existing shareholders or other investors for the purpose of raising additional funds or for other reasons. For instance, the fallout from the global credit market crisis left many banks needing to shore up their balance sheets having suffered multi-billion dollar subprime losses. This resulted in a raft of secondary share offerings or rights issue emanating from top US and European investment banks (not all of which were successful due to donor fatigue setting in as more and more bank shareholders and other investors were tapped for cash).

Follow-on offerings of stock may include not only the issuance of new comon stock, but also preferred shares, mandatory convertibles, convertible preferred, and other forms of hybrid.

Some forms of secondary offerings:
1. Rights issue
2. Bonus issues
3. Stock splits and reverse stock splits