Title

Timing of convertible debt issues

Authors

Authors

S. V. Mann; W. T. Moore;P. Ramanlal

Comments

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Abbreviated Journal Title

J. Bus. Res.

Keywords

Business

Abstract

The popularity of convertible debt as a financing vehicle waxes and wanes. In this article, we investigate whether the timing of convertible debt issues can be explained by three reported reasons for its use as a financing vehicle. Specifically, we reexamine the long-standing beliefs that convertibles are wed as "debt sweeteners" and there are "hot issue" markets for these securities. In addition, we examine whether convertibles help diminish the agency conflict between bondholders and stockholders as suggested by Brennan and Schwartz (1988). Our empirical results suggest that. (1) corporate managers issue convertible debt as debt sweeteners and (2) more convertible debt is issued in hot markets. (C) 1999 Elsevier Science Inc. All rights reserved.

Journal Title

Journal of Business Research

Volume

45

Issue/Number

1

Publication Date

1-1-1999

Document Type

Article

Language

English

First Page

101

Last Page

105

WOS Identifier

WOS:000080163400009

ISSN

0148-2963

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