Foreign Currency Convertible Bond

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Foreign Currency Convertible Bond

A convertible bond that is issued in a currency other than the issuer's own. A company may issue an FCCB if it intends to make a large investment in a country using that foreign currency. For example, when an American company issues a convertible bond in euros because it intends to build a factory in Germany, this is a foreign currency convertible bond. Like all convertible bonds, an FSSB is a bond that a bondholder may exchange, at a certain price, for common stock in the company issuing the bond. The number of shares one receives for each bond and the price one pays for those shares are determined when the convertible bond is issued. This allows bondholders to take advantage of both the low risk of a bond and the potential price appreciation of the underlying stock. The FCCB also reduces the foreign exchange risk for the issuer.
References in periodicals archive ?
The balance USD 28.8 million of the 5 percent April 2016 FCCB series, which were due in April 2016, now stand redeemed in full," the company said.
The conversion prices of these bonds at ` 76.68 and ` 97.26 are much higher than its current share price and converting the FCCBs will incur losses for the holders.
Kirti Vagadia, Chief Financial Officer - Suzlon Group said: "I am very pleased to inform that our bondholders have approved our request for up to a 45 day extension of maturity on our June tranche of FCCBs. The resolutions were approved by significant majorities, with 100 per cent and approximately 93 per cent of bondholders who voted in the June 2009 and June 2007 series, respectively, being in favour of the extension.
Nearly two dozen Indian firms have an outstanding $5.8 billion in foreign currency convertible bonds (FCCBs) that mature in 2012, brokerage Kotak Securities says.
It has varied from 1.30 in 2003 to1.44 in 2006.The only significant hike that can be seen is in the year 2005 when about Rs.350 crores were raised through Foreign Currency Convertible Bonds (FCCB).
Indian firms are also permitted to borrow money abroad by issuance of Foreign Currency Convertible Bonds (FCCB) or via American Depository Receipts (ADRs) and Global Depository Receipts (GDRs).
Established in 1994, MARG Ltd is listed on the Bombay Stock Exchange and the Luxembourg Stock Exchanges (FCCB).
In future, domestic cement companies could go for global listings either through the FCCB route or the GDR route.
is the bank holding company for First Citizens Community Bank (FCCB), a Pennsylvania-chartered commercial bank.
at the time of issuance of Foreign Currency Convertible Bonds (FCCB), and the commercial relationship of Adlabs, now Reliance Media Works Limited , with London-based BT Globenet Nominee's Limited.
In February, Istithmar, an anchor investor in SpiceJet, sold its entire equity stake in the airline for Rs 161.5 crore but remained invested through foreign currency convertible bonds ( FCCB).
Note: Suzlon had issued a 5 year FCCB series in April 2011 for US$ 175mn; having a 5% coupon and April 2016 as maturity date (5% April 2016 FCCB series).