EBs OFFER FUND LEEWAY
The Government will
allow companies to issue
Exchangeable Bonds (EBs),
which would allow companies
to unlock part of their holdings
in group companies for meeting
financing requirements.
The Context
EBs will help group holding companies to provide funding support for takeovers or other large investment needs. Holding companies will now be able to issue bonds, which could be converted into shares of subsidiaries, unlike in a convertible issue where bonds are converted into shares of the issuing company.
The Impact
The measure will have far reaching implications for the corporate debt market, which is currently quite illiquid and suffers from lack of demand from banks and institutions.
The Context
EBs will help group holding companies to provide funding support for takeovers or other large investment needs. Holding companies will now be able to issue bonds, which could be converted into shares of subsidiaries, unlike in a convertible issue where bonds are converted into shares of the issuing company.
The Impact
The measure will have far reaching implications for the corporate debt market, which is currently quite illiquid and suffers from lack of demand from banks and institutions.
0 comments:
Post a Comment