Liquid yield option note

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Liquid yield option note (LYON)

Zero-coupon, callable, putable, convertible bond developed by Merrill Lynch & Co.

Liquid Yield Option Note

A convertible, callable, and putable zero-coupon bond. A LYON is a bond that is convertible to common stock and may be bought or sold as an option, but which does not pay interest. Because it pays no interest, it is issued at a considerable discount from par value of the bond. This guarantees a positive return to the investor, at least until such time as it becomes profitable for the investor to put the bond back to the issuing company for an amount over the issue price. Generally, the total return on a LYON is less than that of the company's common stock, assuming the company does well.
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BBB' rated senior notes, senior debentures and senior liquid-yield option notes (LYONS) are affirmed by Fitch Investors Service following the company's plans to join the Primestar partnership and acquire International Family Inc.
275 billion liquid-yield option notes due 2013, are affirmed by Fitch following News Corp.
275 billion maturity value senior liquid-yield option notes (LYONS) due 2013, are placed on FitchAlert with positive implications.