| 来源类型 | Working Paper
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| 规范类型 | 报告
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| DOI | 10.3386/w2558
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| 来源ID | Working Paper 2558
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| Costs Of Financial Distress, Delayed Calls Of Convertible Bonds, And The Role Of Investment Banks |
| Dwight Jaffee; Andrei Shleifer
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| 发表日期 | 1988-04-01
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| 出版年 | 1988
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| 语种 | 英语
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| 摘要 | In a frictionless market with perfect information, a shareholder-wealth- maximizing firm should force conversion of its convertible bond issue into stock as soon as the bond comes in-the-money. Firms however appear to systematically delay forced conversion, sometimes for years, beyond this time. We show that the observed delays can be plausibly explained in terms of costs to shareholders of a failed conversion and the ensuing financial distress. Firms delay the forced conversion to avoid the self-fulfilling outcome that bondholders expect the conversion to fail, tender their bonds for cash, and the stock price falls to account for the costs of financial distress, in which case tendering for cash is in fact optimal. Unlike other explanations of delayed forced conversion, we can explain the common use of investment banks to underwrite these transactions, since the banks can eliminate the self-fulfilling bad outcome. |
| 主题 | Macroeconomics
; Financial Economics
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| URL | https://www.nber.org/papers/w2558
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| 来源智库 | National Bureau of Economic Research (United States)
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| 引用统计 |
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| 资源类型 | 智库出版物
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| 条目标识符 | http://119.78.100.153/handle/2XGU8XDN/559814
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推荐引用方式
GB/T 7714 |
Dwight Jaffee,Andrei Shleifer. Costs Of Financial Distress, Delayed Calls Of Convertible Bonds, And The Role Of Investment Banks. 1988.
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文件名：
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w2558.pdf
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格式：
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Adobe PDF
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