Academy of Strategic Management Journal (Print ISSN: 1544-1458; Online ISSN: 1939-6104)


Convertible Bonds for Companies Investment Process

Author(s): Oksana A. Karpenko, Tatiana K. Blokhina

The comparison of strategy of companies- issuers of convertible bonds is carried out in the article. As indicators of the strategy the following indicators are taken: Total Asset Turnover (TAT); Return on Assets (ROA); CAPEX/Total Assets; Tobin’s Q (Q Ratio); Issue Size/Total Assets; and Issue Size/Tangible Assets. The results show poor financial performance of the companies-issuers. Convertibles are likely to be commonly used in an investment process by the companies in order to improve the financial performance. There is evidence that Russian enterprises use convertible bonds for investment purposes. The companies may exercise new investment options to improve poor financial performance. At the same time, convertible bonds are used by the companies with low investment opportunities for financing investment projects, attraction of cheap funding and also for refinancing of the previous emissions of bonds.

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