Earn 0% with this Junk Rated Convertible Note

I thought I was seeing things when reviewing a prospectus a minute ago for Hannon Armstrong Sustainable Infrastructure Capital (HASI).

They are offering $125 million in 0% senior convertible notes maturing in 2023.

Looking through it I guess you are simply buying a call option on the common shares with a $48.36/shares strike good for 3 years.

I guess in theory this could work out, but how about 1 or 2% for the holder?

This one I know I will take a pass on.

The prospectus is here.

8 thoughts on “Earn 0% with this Junk Rated Convertible Note”

  1. Tim, Morgan Stanley is the lead underwriter taking this issue public. You have to be pretty confident their investment banking team has this pre-sold in large blocks. So somebody, somewhere with $125 million is ready, willing and able to take it. Oppenheimer is the co-manager, so maybe they are going to load up some of their funds with this. . .

    Like you, I will pass, but would assign a 51% chance it rises after IPO. . .

    1. Shareholders seem to like it and why not – HASI up 7% on the day…. hard to believe I own the common but I do……

      1. 2wr–you know everything I hate just keeps going up–I need to buy everything I hate and sell those I love.

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