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To: TobagoJack who wrote (34262)	5/22/2003 10:14:05 PM
From: jrhana	Respond to of 74559

The first but I imagine far from the last such episode

To: TobagoJack who wrote (34262)	5/22/2003 10:47:56 PM
From: elmatador	Respond to of 74559

Convertible bonds Published: May 22 2003 13:12 \| Last Updated: May 22 2003 13:12 Europe is catching the convertible wave. Siemens is the latest company to follow the lead of US peers, which have binged on convertible bonds this year. The German group has opportunistically raised €2.5bn, probably for future acquisitions. Low interest rates, tightening credit spreads and high volatility have conspired to make convertibles attractive. The huge volume of hedge fund money chasing the opportunity has made it a sellers' market. So far most of those taking the plunge in Europe have experience of convertibles or similar instruments. Some others remain sceptical. Issuers were burnt in the past by misjudged put options or by being forced to repay the debt instead of seeing it converted into equity - as they had assumed during the bull market it would be. But the terms available now look compelling. Siemens will pay about a 1.4 per cent coupon for the 7-year convertible - a fraction of the 4 per cent or so required for a straight bond. The shareholders will be diluted by conversion if the shares rise by nearly 50 per cent. Siemens could one day look like it issued cheap equity, if shares sky-rocket. But shareholders would be complaining from a wealthier position. While demand for convertibles outstrips supply in Europe, more companies should look at taking advantage of the cheap funding opportunity.

To: TobagoJack who wrote (34262)	5/23/2003 12:53:48 AM
From: elmatador	Respond to of 74559

Hutchison sells half Vodafone, DT stakes By Joe Leahy in Hong Kong Published: May 22 2003 18:59 \| Last Updated: May 22 2003 18:59 <<No wonder the Europeans are mad at Hutchison's 3!!>> Li Ka-shing (pictured), Hong Kong's richest tycoon, said on Thursday Hutchison Whampoa, his ports and telecommunications company, had sold off half of its stakes in European carriers Vodafone and Deutsche Telekom, which he estimated had been worth close to HK$40bn ($5bn). Mr Li said the stakes, which are a legacy of asset trades Hutchison made at the height of the telecoms boom, were sold because they were regarded as non-core assets. "I have already sold more than half of the shares at a premium," Mr Li said after the annual meeting of Cheung Kong, his flagship company. The shares date from Hutchison's sale of its stakes in VoiceStream, US telecoms company, to Deutsche Telekom in 2000 and in Mannesmann, German operator, to Vodafone the same year. The orderly disposal of stakes worth $2.5bn by Hutchison will be regarded with relief by investors. In the past, rumours that Hutchison might dump the shares have acted as an overhang on Vodafone and Deutsche Telekom's share prices. The fluctuating value of the stakes has also made it difficult to forecast the Hong Kong-based ports and telecoms group's financial results. "The more they reduce their exposure there, the less volatile the value of their earnings will be," said one analyst in Hong Kong. Hutchison valued the Vodafone stake at HK$20.1bn and the Deutsche Telekom stake at HK$11.7bn in its 2002 annual report. Mr Li said the stakes were sold over the past few months but did not disclose at what point their value had increased to nearly HK$40bn. "What's left now is less than HK$20bn," he told reporters.