Kapovaz is a widely used term in capital markets, specifically in Germany, that refers to the concept of a voluntary capital increase without pre-emptive rights.

In German, "Kapitalerhöhung ohne Bezugsrecht" is used interchangeably with Kapovaz. This financial term holds significant importance for investors and companies alike, as it pertains to the raising of additional capital in an alternative manner. When a company decides to engage in a kapovaz, it aims to raise funds by issuing new shares without offering them to existing shareholders first. This approach differs from a traditional capital increase (Kapitalerhöhung mit Bezugsrecht), wherein shareholders are provided with the opportunity to purchase new shares in proportion to their existing holdings. By exercising the right of pre-emption, shareholders can maintain their ownership percentage in the company. Kapovaz transactions, on the other hand, enable companies to attract new investors or strategic partners without burdening current shareholders with additional financial obligations. These transactions typically occur when a company wishes to secure funds swiftly or when shareholders are not interested or capable of participating in the capital increase. The decision to undertake a kapovaz hinges on various factors, including the company's financial needs, market conditions, and the potential dilution impact on existing shareholders. It is important for investors to carefully evaluate the implications of kapovaz transactions, as they can significantly alter share structures and, consequently, ownership stakes. In summary, kapovaz is a specific term used to describe a voluntary capital increase without pre-emptive rights in the German capital markets. This approach allows companies to raise capital efficiently while potentially attracting new investors or partners. Investors should thoroughly assess the consequences of kapovaz transactions to make informed decisions regarding potential dilution and ownership restructuring.