What are pre-emption rights?

This is a right for existing shareholders to have the first refusal on the issue of new shares by a company. These rights protect shareholders against dilution of their shareholdings. Where pre-emption rights apply, shares are offered to holders of relevant shares in proportion to their existing holdings. Crowdcube’s standard requirement for the share class a Company offers to Crowdcube investors is that it is a class of Ordinary Shares with pre-emption rights (which will be held by Crowdcube Nominees, who will organise the availability of those pre-emption rights to investors via the platform) however, every pitch is different so always be sure to read the legal review which will be attached to the email you are sent after the pitch closes to investment.