Question
ABC Corp issues convertible preferreds with a $25 par value and a $2.50 annual dividend. The conversion ratio on the preferred is 3 (3 common
ABC Corp issues convertible preferreds with a $25 par value and a $2.50 annual dividend. The conversion ratio on the preferred is 3 (3 common stocks for each preferred share). The market price of the preferred is $32 and $10 for the common shares.
- What is the conversion value/price of the preferreds?
- What is the conversion premium?
- Would you convert your shares at this price?
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Economics And Personal Finance
Authors: Irvin Tucker, Joan Ryan
1st Edition
1133562108, 978-1133562108
