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Hilton Hotels Corp has a converatble bon issue outstanding Each bond with a face value of $1000 can be converted into common shares at a rate of 612983 shares of stock per $1000 face value bond

Hilton Hotels, Corp. has a converatble bon issue outstanding. Each bond, with a face value of $1,000 can be converted into common shares at a rate of 61.2983 shares of stock per $1,000 face value bond. or $16.316 per share. Hilton's common stock is trading at $15,90 per share and the bonds are trading at $975. Calculate the conversion value of each bond. Determine if it is currently profitable for bond holders to ocnver their bonds into shares of Hilton Hotel common stock.

 

Apr 03 2020 View more View Less

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