GREY:CLLZF - Post by User
Post by
leveraged1on Dec 03, 2014 10:20am
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Post# 23189555
Address - liquidity and capital structure
Address - liquidity and capital structureLiquidity - company needs to attract more volume of market activity (turnover)
Capital Structure - is a reflection of debt to equity ratio. Cll too much debt / not enough equity.
Solution - the company attracts more market activity (more liquid) if it reduces debt (bond holders forgive "some of" their debt) and increases equity per share (shareholders give up "some of" their shares. Fairness- depends on the value ascribed to the debt and the shares when forgiven and given up respectively.