I have had such rights issued to me for a European stock I own. The rights had their owner ticker symbol and were tradeable like a stock untill the end date of the rights...
Rights offerings are very common in the UK :
The majority of UK rights offers are for companies listed on AIM, thus smaller ones. The major intention of such offers there is to help growth of smaller firms while allowing early investors to maintain control positions if they wish to do so.
in this thread there are a couple examples of declining companies issuing rights offers because they had weak sources of liquidity.
Tesla probably would not do any such offer, mostly because first, they do not need capital injections and second, in the US these are not so readily accepted as in other places like the UK.
Some of us seem to think that this would be a good, if gimmicky, way to penalize shorts. Really this would open many new avenues for question.
Stock splits, though, are a time honored way to make shares more accessible to smaller investors. In the current world of partial share sales that is perhaps less necessary. Still, with the popularity of TSLA to younger investors plus t enthusiasm of that demographic for Tesla product and video games it seem that a stock split is probably a good idea.
A similarly positioned company, Apple, regularly splits to keep share prices well below $200. That has been a wise move, partially because shareholders tend to become avid buyers of their products, and the most frequent upgrades too. (I offer no evidence for this assertion, all that is proprietary).
We have no authoritative data regarding the extent of TSLA holdings by Tesla buyers. We do that this thread no several others. They all are fairly active with substantial readership. In addition there are the odd comments from Elon and others about the activity of individual investors.
Thus, I think they will have a stock split again very soon. I do not think they’ll fool around with gimmicks like rights issues. OTOH, neither the SEC nor any other agency is likely to curt short sellers including the ever-present ‘rolling fails’. This subject is periodically raised, most often between custodians, the DTC (Depositary Trust Company) and other fiduciary entities.
Note: I haven’t worked with this stuff since a couple of decades when I was working with Global Custody, Global Master Trust, Registrar and related products. The issues of market maker abuse and fraud, settlement fails and countless other technical risks were t the center of the product viability.
If anybody is really interested in details and history there is abundant documentation directly and indirectly connected. Abuses, legal and illegal, have been pretty much worldwide. Check out VW/Porsche to see how ridiculous a short squeeze can be. Most companies destroyed by FUD have been small and/or weak.
So, in my very humble opinion, Tesla would be poorly served to use gimmicks, especially since a routine split or two can achieve similar goals without the histrionics.
Its misapplication in common instances of late is rampant.
cleantechnica.com
