Oversubscribed issue

Oversubscribed issue

Investors are not able to buy all the shares or bonds they want, so underwriters must allocate the shares or bonds among investors. This occurs when a new issue is underpriced or in great demand because of growth prospects.

Oversubscription

A situation in which investors show so much interest in a new issue of a security that demand exceeds supply. Before a new issue, underwriters canvass potential investors, who may or may not book an order to buy a portion the new issue. If investors order more shares than there are shares being issued, the security is said to be oversubscribed. This may affect the price when the security is actually issued.
References in periodicals archive ?
The oversubscribed issue has allowed us to develop strong relationships with a new set of investors in Taipei.
While the OGDC stake is likely to be offered at a discount and could thereby drag the market lower in the near-term, an oversubscribed issue would lead to a swift uptick in general investor confidence.
In cases where the allottees are selected by lottery, it could even be that you get no shares in a heavily oversubscribed issue.
Earlier in July, MTG repaid a SEK3bn credit facility, originally due for refinancing in April 2010, via an oversubscribed issue of three-year bonds.
The oversubscribed issue quickly closed and the shares will start trading tomorrow to give the 4,250 leased and tenanted pubs group a market capitalisation of around pounds 570 million.
Integrated Capital PJSC today celebrated its strong contribution as a co-lead on the successful completion of the oversubscribed issue of $500,000,000 of Notes by EA Partners II B.