RE:RE:Share offeringThere certainly is a difference between debt and equity...
Equity is a stake/ownership of the company (basically a permanent arrangement)...you are essentially selling a portion of the company
Debt is borrowed money, that is eventually repaid (principal), along with periodic interest payments. Debt holders are entitled to their money back and interest, but they have no ownership stake
If you issue more equity (your current ownership stake essentially shrinks...PERMANENTLY).. yes the company can buy back shares at a later date, but thats a whole other thing, with its own set of rules
BLACKJACK86 wrote: Bananahanger, congrats, you figured it .
Trying to make this easier, lets take the cake example.
you are 6 eating a cake, but 40 percent of that cake you cannot eat because it belong to somebody else(bondholder), so you're just eating 60 percent .
you get 4 people to buy the part of the bondholder ( that you cannot eat anyway) you still get to keep your share (60 percent) and those 4 people are eating the 40 percent that used to belong to the bondholder anyway.
so what are existing shareholder loosing?
nothing .
of course all this at todays price,no discount to the new shareholder.