MOD 5 Case FIN - Equity and Debt Byron E. Ferguson FIN 301...

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Equity and Debt 1 Byron E. Ferguson FIN 301 – Principles of Finance Module 5 Case Dr. John Halstead October 22, 2010
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Equity and Debt 2 Why equity vs. debt financing? The American Superconductor’s (AMSC) management and board of directors believe the decision to forgo secured debt financing and adopt a equity financing strategy under current market conditions is the best option for their shareholders. AMSC changed their plan from financing a $50 million secured debt to equity financing it by offering public stock to raise money. How is this possible? The company offers a range of proprietary technologies and solutions covering electric power infrastructure, from generation to delivery, and end use. AMSC is a leader in alternative energy, providing proven megawatts scale wind turbine designs and electrical control systems. It offers a host of Smart Grid technologies for power grid operators that enhance the reliability, efficiency, and capacity of the grid. Moreover, seamlessly integrates renewable energy sources into the power infrastructure. During the Northeast blackout, AMSC rose to a respectable level of profitability, due to such a demand for more efficient grid sustainment. AMSC products, such as a system installed in the aging Connecticut grid and high temperature superconductor power cables and other devices bought by China for its grid, are designed to improve the cost, efficiency and reliability of systems that generate, deliver and use power.
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This note was uploaded on 02/01/2012 for the course OPM 300 taught by Professor Dr.garyhanney during the Spring '11 term at Trident Technical College.

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MOD 5 Case FIN - Equity and Debt Byron E. Ferguson FIN 301...

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