What does that mean? are they in cash trouble and need the money?
Peace,
2007-02-14 08:33:31 · 4 answers · asked by George 3 in Business & Finance ➔ Other - Business & Finance
Big fat IOU to whomever takes it.
They usually do that to get working capital to continue to run if they are running low on cash and are hoping to turn things around.
2007-02-14 08:42:13 · answer #1 · answered by Santa Barbara 7 · 1⤊ 0⤋
A note issue as stated is a BOND. All bonds have a face value of $1,000 at the assigned interest. The noted announcement means that there are 200,000 bonds available for sale. You can buy one or up to all.
The companies use of the money is no indication of trouble or success. A careful study of the company, its pass operation, and its projected goals will help determine if the holding of the bond is good or bad.
2007-02-14 16:41:32 · answer #2 · answered by whatevit 5 · 1⤊ 0⤋
It means that they are willing to trade IOU's (interest bearing notes) for cash. It could be for whatever reason a company needs cash - expansion, smooth out cash flow, etc. Obviously, a company does this to get an infusion of cash. It does not mean they are in any kind of financial trouble.
2007-02-14 16:40:31 · answer #3 · answered by Flyboy 6 · 1⤊ 0⤋
Possibly, depends on the company. Check the rates they are being offered at, that will give you a good indication of what the company who underwrote the debt thought the risks were.
It could be as simple as getting $200 million at today's rates to pay off debts at higher rates from years earlier. It could be to expand their production to meet demand. Either is a good reason.
2007-02-14 16:43:25 · answer #4 · answered by Yanswersmonitorsarenazis 5 · 1⤊ 0⤋