Legacy of Black Monday: a gray equity market
Article Abstract:
The stock market crash of Oct 1987 is analyzed and investment strategies for 1988 are discussed. The merger and acquisition frenzy is probably over, but the steady downturn in equity prices makes 1988 a good year to effect a merger or acquisition already on the agenda. Lower stock prices may make some firms vulnerable to takeover. The initial public offering market will remain inert for the first half of 1988 and public common stock offerings will not be welcomed. The economy will continue to be uncertain as a result of federal and trade deficits. Private placements with institutional investors are excellent financing opportunities. Convertible securities and adjustable-rate preferred (ARP) markets are attractive now. Corporate treasurers should be careful with ARPs because of proposed tax changes, however.
Publication Name: Cashflow Magazine
Subject: Business
ISSN: 0196-6227
Year: 1988
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Wide range of factors favor overseas financing
Article Abstract:
Hudson Strategy Group Inc Sr VP and research dir Irving Leveson says that international capital markets will show increasing appeal to US firms in light of changes occurring in those markets. Leveson points out that factors which had previously discouraged companies from engaging in international fund raising are diminishing. It is becoming easier to modify currency risks, competition is bringing down the cost of underwriting margins, and structuring foreign deals is less complex than in the past. Leveson says that Japan will continue to be an appealing market for US corporations, partly because the Japanese save more than their American counterparts, and because the returns expected by Japanese investors continue to be lower than US rates.
Publication Name: Cashflow Magazine
Subject: Business
ISSN: 0196-6227
Year: 1987
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It's time to reassess your banking relationships
Article Abstract:
Corporate treasury managers should watch their banks carefully in case the bank's rating is down-graded. When a bank's debt rating falls, its cost of money rises, and loans become more expensive to obtain. Stricter capital requirements and narrower margins compound this situation. The highest rated banks are now more likely to be strong regional banks than money center banks, and the banks are now in a good position to offer more credit at better terms. Domestic operations of foreign banks also enjoy high ratings.
Publication Name: Cashflow Magazine
Subject: Business
ISSN: 0196-6227
Year: 1987
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