Hexcel has a 7 percent coupon rate bond issue outstanding that matures in 2007. The Wall Street

Question:

Hexcel has a 7 percent coupon rate bond issue outstanding that matures in 2007. The Wall Street Journal reports a bond price of $582.50. These bonds are convertible into common stock. Why do you think a company would issue this type of bond?

Coupon
A coupon or coupon payment is the annual interest rate paid on a bond, expressed as a percentage of the face value and paid from issue date until maturity. Coupons are usually referred to in terms of the coupon rate (the sum of coupons paid in a...