Mandatory Convertible

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Mandatory Convertible

A bond that must be converted into common stock in the company issuing it on or before a certain date. An advantage of a mandatory convertible to the investor is the fact that it guarantees a certain return up to the conversion date, after which there is no guaranteed return but the possibility of a much higher return. A publicly-traded company issues mandatory convertibles when it needs to raise the capital provided by issuing stock, but when doing so would put a strain on the price of existing shares.
References in periodicals archive ?
In addition, holders of FCA mandatory convertible securities are entitled to receive 0.
BANKING AND CREDIT NEWS-December 11, 2014-FCA prices offering of common shares, mandatory convertible securities
Summary: Ageas has previously communicated on its claim against Fortis Capital Company Limited ("FCC") and on a possible claim in respect of Mandatory Convertible Securities ("MCS")*.
GM is not expected to issue new common stock in the IPO but plans to sell about $3 bln in mandatory convertible securities that convert into shares in the future, a person familiar with the plan previously told Reuters.
As such, the notes are meant to constitute a form of mandatory convertible securities.
and to distribute that ownership interest to holders of FCA shares and mandatory convertible securities, as further described in the EGM documentation.
M2 EQUITYBITES-December 11, 2014-FCA prices offering of common shares, mandatory convertible securities
There is no change in the high level of equity credit, up to a maximum of class E (100% equity credit for three years prior to exercise), that Fitch allocates to mandatory convertible securities or units that have a host security before exercise that ranks as a subordinated or preferred stock claim and include a means for the issuer to defer dividends or interest payments without causing a default.
The mandatory convertible securities will be convertible at prices ranging from $48.
5 billion of mandatory convertible securities to be issued by Citigroup Inc.
This debt was originally issued in connection with GAMCO's sale of mandatory convertible securities in February 2002 and was remarketed in November 2004.
0 billion of common stock and $500 million of mandatory convertible securities will be utilized by NRG to fund the $4.

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