"I question whether these (converting notes) should be considered as liabilities or deferred equity."
According to the accounting standards of Australia, these notes are classified as debts by law.
On the other hand, if these notes would be converted to shares one day, then the value of the existing shares would be diluted.
Say only 1/4 of TIM's total debt of $864M belongs to converting notes, that is $216M, then, given TIM's present market cap is only $206M, the share value would be diluted by more than 100%!
So which way do you prefer?
TIM Price at posting:
58.0¢ Sentiment: Sell Disclosure: Not Held
