Staff at Cypress Semiconductor Corporation cash (Cypress) had received the final version of the proposed 600 million dollars of convertible bonds outstanding. This would be the latest in a series of convertible bond issues by Cypress. But this time the situation was very different. The most recent deals were in 2000, when the price action Cypress trading in the range of $ 40 to $ 50 for the year and had, in fact, reached a maximum of $ 57.75 May 2000. The landscape has changed dramatically over the past three years. A day earlier, May 16, 2003, the closing price was $ 10.51. Of course, the situation was the same for almost all high-tech stocks, but did not consider the issue of security based on equity, while less painful, given the current share price.
Robert M. Conroy
Source: Darden School of Business
Release Date: October 14, 2008. Prod #: UV1049-PDF-ENG
Cypress Semiconductor: 1.25% Convertible Bonds Case Solution