Woolworths Group recently sold a 1,000-par-value, five-year convertible bond with a 5% coupon rate. The interest payments

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Woolworths Group recently sold a £1,000-par-value, five-year convertible bond with a 5% coupon rate. The interest payments will be paid annually at the end of each year and the principal will be repaid at maturity. A similar bond without a conversion feature would have sold with a 7% coupon rate. What is the minimum price that the convertible bond should sell for?

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Principles Of Managerial Finance

ISBN: 9781292400648

16th Global Edition

Authors: Chad Zutter, Scott Smart

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