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AEM1200-0207 (2)

2012 kimberly clark issued 300 million in in 10 year

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Unformatted text preview: s, at 2.4% coupon, to finance repayment of outstanding $400 million notes at almost 6%. These monies, in turn, were used to back working capital and buyback equity; back In May 2011 LinkedIn had an IPO of $350 In million, that it is using to develop the “Hiring Solutions” product, to acquire other companies, and to expand in Europe. and Retained Earnings Retained The portion of after-tax net income of a corporation not The paid out to shareholders in the form of dividends, but which instead is retained for use in the business. which Advantages Cheap Full control Avoids the double tax penalty Disadvantages Hard and slow to accumulate How do shareholders relate to it? Crises are characterized by absence of earnings. Long term debt Long Debt obligations issued by private or public companies Debt to raise funds for a variety of corporate purposes such as building a new facility, purchasing equipment, or expanding the business. expanding Corporate bonds Securitized, syndicated bank loans Advantages Cheaper than equity, because they are not taxed (and Cheaper interest is tax deductible) interest Relatively easy to raise, multiple sources Leverage Disadvantages Interest payments, to be made no matter what; Credit worthiness an issue Lenders frown on volatility. Why do companies take loans? Why Supply side The normal transacting of business is made much easier by cred...
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