Difference between revisions of "ACO"
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(Replaced content with "ACO Category:mbi Category:M10 Category:Term") Tag: Replaced |
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| − | ACO | + | In finance, a convertible [[Bonds|bond]] is an asset the holder can convert into shares of common stock in the issuing company or cash of equal value, at an agreed-upon price. An Automatic Convertible Bond has some unique properties: |
| + | * The holder of an ACO would get at an upfront agreed discount at the initial product offering ([[IPO|IPO]]) | ||
| + | * The holder gets a guarantee to get the stock | ||
| + | * The holder gets a minimum buying price or a maximum price. | ||
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| + | ACO was discussed in the MBI training in the context of the [[M10-S2 - Case - Lernout and Hauspie Speech Products|Lernout and Hauspie Speech Products case]]. As there is a minimum and a maximum scenario the holder of an ACO has a significant uplift or downlift. The reason for including this range is to communicate an expected price for the IPO. | ||
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| + | <html> | ||
| + | <audio controls><source src="/static/files/MBI/Module%2010/M10-S2%20-%20Explanation%20ACO.mp3"type ="audio/mp3"/></audio> | ||
| + | </html> | ||
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| + | See also: http://en.wikipedia.org/wiki/Convertible_bond | ||
[[Category:mbi]] | [[Category:mbi]] | ||
Latest revision as of 19:53, 27 August 2020
In finance, a convertible bond is an asset the holder can convert into shares of common stock in the issuing company or cash of equal value, at an agreed-upon price. An Automatic Convertible Bond has some unique properties:
- The holder of an ACO would get at an upfront agreed discount at the initial product offering (IPO)
- The holder gets a guarantee to get the stock
- The holder gets a minimum buying price or a maximum price.
ACO was discussed in the MBI training in the context of the Lernout and Hauspie Speech Products case. As there is a minimum and a maximum scenario the holder of an ACO has a significant uplift or downlift. The reason for including this range is to communicate an expected price for the IPO.
