The Consequences of Issuing Convertible Bonds Dilution & Financial Restructuring

Save
Next Video:
How to Buy Physical Copper as an Investment....5

Issuing convertible bonds for the purposes of dilution and financial restructuring has some very clear consequences that you're going to need to be aware of. Find out about the consequences of issuing convertible bonds for dilution and financial restructuring with help from a registered investment adviser in this free video clip.

Part of the Video Series: Investment Tips
Promoted By Zergnet

Comments

Video Transcript

Hi, I'm Benjamin Lupu, certified financial planner of Kensington AMI registered investment adviser with the consequences of issuing convertible bonds dilution and financial restructuring. Convertible bonds are a sort of a hybrid type investment instrument. They are bonds which means that they are in the form of debt. The issuing company owes the holder of the bond principle value in cash at maturity and interest payments periodically just like a regular bond but in convertibles, the bond can be converted into common stock under certain circumstances. Issuing convertible bonds and then converting the debt into equity shares of stock can dilute the common stock equity because there is more shares but it does remove the debt from the company balance sheet so it's kind of a tradeoff. Company managements may choose to do this for a variety of reasons. This would be one form of a pre-planned financial restructuring with the consequences of issuing convertible bonds dilution and financial restructuring, I'm Benjamin Lupu, certified financial planner of Kensington AMI registered investment adviser.

Featured

Related Searches

M
Is DIY in your DNA? Become part of our maker community.
Submit Your Work!