A seasoned issue is an additional security issuance for which there is already an established secondary market. These securities have already been traded for a sufficient period of time that investors can count on a reasonable amount of price stability and trade volume. The initial issuance price of these shares is based on the existing market price of shares that are already in circulation. Additional share offerings by blue-chip companies are considered to be seasoned issuances.
A seasoned issue can dilute the holdings of existing shareholders, which can depress the market price of the stock. However, this is not the case when the shares being sold are from the holdings of existing issuer owners (such as the founders), since the total pool of shares issued and outstanding does not change.
A seasoned issue is also known as a follow-on offering.