RE:RE:RE:Another picture - $50m 6% Debentures vs $50m common shares There is no put to consider.
This is comparing owning the common equity here vs. The call option to buy it at 3.80, plus the yield component.
The only downside protection with the debenture is that you get your principal back if the stock is not above 3.80 and you can take that $1,000 and buy the stock at a lower price than your 3.80 option.
But that option is only valuable vs buying the equity today if you believe that the stock in 5 years is lower than today's price.
Now to some institutions, this is a pretty good 4.2% yield net of the common equity dividend. They can buy something that they otherwise might not be able to and have exposure to the upside.
I see a lot of the pension funds being interested in this given the low yield environment.