Using a Goldman Sachs' proprietary structure, Stock Indexed Zero Coupon Securities SIZeS, the company launched a $130 million convertible yesterday Thursday. Initially, it had been hoping to raise up to $300 million from a combined convertible and DR offering, but ruled out the latter option after realising that investors would demand huge discount pricing to spot.
With a five year final maturity subject to annual puts, the convertible has a par in par out structure, meaning that the bonds carry a zero coupon and zero yield to maturity. Investors like this because there is no downside risk, says one convertibles analyst. Whatever happens, they can...
