guys the more i look into this the fishier it gets.abs will...

guys the more i look into this the fishier it gets.

abs will receive a cash payment of 0.6*775 = $465m

and receive approx $310m from issuing convertible notes

all of this will be used to pay down its syndicated bank debt.

however, convertible notes are classified as debt, which means the net change in the debt position is $465m

so basically what abs is doing is raising cash by issuing convertible notes to pay down debt - substituting one form of debt for another. they are doing this because they are cashflow negative and desperately need cash.

this is not sustainable and i don't think the market will be impressed tomorrow.