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Lynde Corporation common stock currently sells for $28, and its 9 years maturity convertible bond with 14% annual coupon rate paid semi-annually has a yield
Lynde Corporation common stock currently sells for $28, and its 9 years maturity convertible bond with 14% annual coupon rate paid semi-annually has a yield to maturity of 12%. Each bond can be converted into 37 shares of common stock at any time before maturity. What is the conversion value of the bond and would bondholders convert their bond into stock today? You need to provide calculations to support your answer.
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