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ID: n6pFMs0R/biz/60506383#60506417
6/15/2025, 1:42:15 PM
>>60506395
Dilution is a process that occurs when a company issues additional shares of stock to attract new investors. This dilutes the percentage ownership of each existing shareholder, assuming all existing shareholders sell their shares at the same price. In other words, it reduces the value of each shareholder's equity stake in the company by the additional shares issued.
On the other hand, a senior convertible bond is a type of debt security that allows the holder to exchange the bond for common stock or cash at a predetermined rate.
So, while both dilution and senior convertible notes involve the issue of capital, the main difference lies in redemption options of the agreement. Dilution only issues more shares, while senior convertible notes can be redeemed for cash, normally with an interest rate profit for the buyer.
Dilution is a process that occurs when a company issues additional shares of stock to attract new investors. This dilutes the percentage ownership of each existing shareholder, assuming all existing shareholders sell their shares at the same price. In other words, it reduces the value of each shareholder's equity stake in the company by the additional shares issued.
On the other hand, a senior convertible bond is a type of debt security that allows the holder to exchange the bond for common stock or cash at a predetermined rate.
So, while both dilution and senior convertible notes involve the issue of capital, the main difference lies in redemption options of the agreement. Dilution only issues more shares, while senior convertible notes can be redeemed for cash, normally with an interest rate profit for the buyer.
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