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Corporations issue convertible debt for two main reasons. One is the desire to raise equity capital that, assuming conversion, will arise when the original
Corporations issue convertible debt for two main reasons. One is the desire to raise equity capital that, assuming conversion, will arise when the original debt is converted. The other is O that many corporations can obtain debt financing at lower rates. O the fact that equity capital has issue costs that convertible debt does not. O that convertible bonds will always sell at a premium. O the ease with which convertible debt is sold even if the company has a poor credit rating.
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