Sauce for the goose?

Article Abstract:

European stocks have performed well, but this is less true for corporate bonds, partly due to an increase in supply, and also due to fears of inflation, which could mean interest rate rises. Corporate bonds are being downgraded by credit agencies, and this is unusual for investors in European bonds, since companies cared for their creditors in Europe. This is changing as companies increase debt levels. There are also event risks arising from technological change and the single European currency, which has led to increased competition and more acquisitions and mergers.

Private Bonds & Notes, Europe, Corporate bonds

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Outsourcing capital

Article Abstract:

United Grain Growers (UGG) is a small Canadian company that has effectively substituted the capital of Swiss re for part of its equity. This is a pioneering deal in terms of corporate finance. Lower grain volumes pose a risk to the company and Swiss Re is able to provide insurance for this risk more cheaply than UGG. The cost of capital for UGG is reduced. Companies should focus less om debt to equity ratios and focus on the amount of capital required, and its cost.

Grains, Oilseed and Grain Farming, Cash Grains, Finance, Grain industry, Corporations, Corporate finance, United Grain Growers Inc.

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