A company wants to issue 1,000,000,000 bonus shares as fully paid up on a 1:1 basis (one bonus share for one existing share held). The company says it needs to increase the authorised share capital from $500,000,000 comprising 1,000,000,000 shares to $1,000,000,000 comprising 2,000,000,000 shares to faciliate the bonus issue.
What does it mean by fully paid up? I assume I will get bonus shares for free, but why did they state "fully paid up"?
How can a company just "increase" the authorised share capital from $500 million to $1 billion? Do they need to get $500 million dollars from somewhere to increase the authorised share capital? If so, why not just give the existing shareholders the $500 million, (and do a stock split if desired)?
What is the advantage (and disadvantages if any) of increasing the authorised share capital? On wikipedia it states that the difference between a bonus issue and a stock split is that a stock split will split the company's authorized share capital, but the distribution of bonus shares will change/increase the share capital. What is the advantage/disadvantages of either splitting or increasing the share capital?