1. Mark Fielding-Pritchard
Sembilan
Mark Fielding-Pritchard
mefielding.com

2. Sembilan a) Payable 320m x 0.037625 Receivable (Yield - fee)
Difference 1
12040
x 0.025= 8000
4040 2
9920
2120 3
11200
840 4
12160
(120)
6488
mefielding.com

3. Sembilan b) Pay bond holders LIBOR + 60 a) Receive b) Pay fixed 3.7625
a) + c) – b)
If Libor is 5%
17920
16000
12040
13960
If Libor 6%
21120
19200
Libor 4%
14720
12800
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4. c)
You are converting short/medium term debt to permanent equity capital
Costs of issue
Method of issue
Stock market reaction
Tim elapsed since previous issue
Ability to raise more debt
Cost of equity, higher than debt
Gearing ratio
EPS effect
Tax issues
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