Keyel Bhd. has issued RM40,000,000 convertible bond with 15 years of maturity. The bond has a coupon rate of 8 per cent with a par value of RM1,000 each. The company plans to distribute 30 shares in the exchange for 1 convertible bond. After the issuance of convertible bond, the company expects its operating profit to boost to RM29,000,000. The current operating profit is RM22,000,000. Tax rate is 20% and the company pays annual dividend of RM1,000,000 to its preferred shareholder. The company has outstanding shares of 23,000,000 units. Currently, the company did not have any long term financing. The current market price for its share is RM20