Exchangeable Debt

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Exchangeable Debt

A debt security that the holder may exchange, at a certain price, for common stock in the company other than the one that issued the debt security. The number of shares one receives for each security and the price one pays for those shares are determined when the exchangeable debt is issued. Most of the time, the common stock is in a subsidiary of the company that issued the exchangeable debt. Exchangeable debt is a low-risk investment, but it affords the investor a great amount of leeway because he/she can exchange it for another security with higher risk and a higher return. Exchangeable debt operates like a convertible bond; the main difference is the fact that in a convertible bond the common stock that one may buy is the stock of the company issuing the bond rather than that of a subsidiary.
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There is currently strong investor appetite for GCC convertible and exchangeable bonds, in particular when issued using standard structures rather than Sukuks.
Section II describes the premises of the exchangeable bonds issues.
The Privatization Commission has planned to earn over Rs 68 billion, including the intended $ 500 million Oil and Gas Development Company Limited (OGDCL) exchangeable bonds during the current fiscal year but it never came into reality.
The bank will seek a reliable securities firm to underwrite the projected exchangeable bonds, indicating that Mega has given up its earlier plan of merging with Taiwan Business.
The exchangeable bonds, which will be listed in the Singapore Stock Exchange, have a maturity of three years, a coupon of 2 percent per annum and a conversion premium of 25 percent  of the offer price, the company said.
The agreement envisages mandatory purchase of exchangeable bonds worth $2.
e convertible and exchangeable bonds for State-Owned Enterprises (SOEs) and pursuing privatisation process under the Public Private Partnership (PPP) Mode.
75 percent exchangeable bonds due in 2013, the company said on Friday.
Under the plan, DOCOMO will exchange 40% of its KTF shareholding for KT common stock and the remaining 60% for KT exchangeable bonds.
In a press release issued Monday, Nikko Cordial said it had falsified the statements by illicitly booking evaluation gains on the exchangeable bonds of one of its subsidiaries, NPI Holdings Inc.
Lagardere said it would issue mandatory exchangeable bonds subscribed by French bank IXIS CIB, which had parked most of the 61 million underlying EADS shares with French institutions.
The AMF claims Viv U was party to two pieces of privileged information--Marvin Davis' offer to buy Universal, and the probability that Viv U would exercise preemptive rights to up its stake in the French telco Cegetel--when it issued exchangeable bonds in November 2002.