easy · Debt Capital Markets
A bank is 'pitching' a bought deal to a client. The client asks: 'What happens if the book is only 0.5x covered at our target price?' The bank's response in a bought deal is:
- 'We still pay you the full amount at the agreed price and take the unsold bonds into our own inventory.'
- 'We cancel the deal and you don't get any money.'
- 'We will automatically lower your coupon to attract more buyers.'
- 'You have to pay us an extra 2% fee to find more investors.'
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More Debt Capital Markets practice
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