Companies offer rights issues as a way to raise capital. A rights issue allows existing shareholders to purchase additional shares at a discounted price, proportionate to their current holdings. This gives them the right to purchase new shares before they are made available to the public. Companies use the proceeds from a rights issue to fund expansion projects, pay off debt, or invest in new technologies. Offering a rights issue is typically less dilutive to existing shareholders than issuing new shares to the public. It is also a quicker and more cost-effective way of raising capital compared to issuing debt. Rights issues provide companies with the opportunity to raise capital while maintaining their existing shareholder base.