The determinants of the convertible bonds call policy of Western European companies - Archive ouverte HAL Accéder directement au contenu
Article Dans Une Revue International Review of Financial Analysis Année : 2021

The determinants of the convertible bonds call policy of Western European companies

Résumé

This paper analyzes the determinants of the convertible bonds call delay of the Western European firms. This delay is analyzed comparatively to the optimal call policy suggested by Ingersoll (1977a) who argues that in a perfect market, managers should call the convertible bonds immediately when the conversion value reaches the call price. Like the previous studies in the US market, we find that the Western European companies delay the call of their convertible bonds for several weeks. This delay is explained by considering the main theoretical rationales for the convertible bonds call delays (the notice period, the call protection provisions, the cash flow advantage hypothesis, the financial distress and the signaling theory). The results are consistent with the cash flow advantage rationale but less evidence is found for the other theories.
Fichier principal
Vignette du fichier
Adoukonou et al-2020-The determinants of the convertible bonds.pdf (1.4 Mo) Télécharger le fichier
Origine : Fichiers produits par l'(les) auteur(s)

Dates et versions

hal-03040739 , version 1 (15-12-2020)

Identifiants

Citer

O. Adoukonou, Florence André-Le Pogamp, Jean-Laurent Viviani. The determinants of the convertible bonds call policy of Western European companies. International Review of Financial Analysis, 2021, 73, pp.101582. ⟨10.1016/j.irfa.2020.101582⟩. ⟨hal-03040739⟩
219 Consultations
152 Téléchargements

Altmetric

Partager

Gmail Facebook X LinkedIn More