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The 10% convertible loan stock of Omega Itd. is quoted at $140 per $100 nominal. The earliest date for conversion is in
Posted: Tue Jan 18, 2022 12:57 pm
by answerhappygod
- The 10 Convertible Loan Stock Of Omega Itd Is Quoted At 140 Per 100 Nominal The Earliest Date For Conversion Is In 1 (219.57 KiB) Viewed 50 times
The 10% convertible loan stock of Omega Itd. is quoted at $140 per $100 nominal. The earliest date for conversion is in 4 years' time at the rate of 30 ordinary shares per $100 nominal loan stock. The share price is currently $4.15. The annual interest on stock has just been paid. Required: What is the average annual growth rate in the share price that is required for stock holders to achieve an overall rate of return of 12% a year compound over next four years, including the proceeds of conversion? What is the implicit conversion premium on stock?