What is Corporate Action?

A corporate action is any actions at management level which is generally approved by Board of Directors in a company that causes financial structure change in an organization and has an impact on its stakeholders, which include common and preferred stockholders, as well as bondholders.

When a publicly traded company conducts a corporate action, a process that has a direct impact on the securities (stocks, bonds, etc.) issued by that company will be initiated. Corporate actions can range from urgent financial matters like bankruptcy or liquidation to a company changing its name or trading symbol.

Some common examples of corporate actions are payment of dividends, stock splits, reverse stock, tender offers, mergers and acquisitions, spin-offs, and rights issue.

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