senior subordinated note

[pychicot]

Hello all,

what is "senior subordinated note"?

シニア劣後債？

Aren't ”senior” and ”subordinated” contradictory?
Or, are there any ジュニア劣後債？

I am just confused.

Thanks in advance for any kind of help.

Keiko Kurihara

[Franzi]

On Nov 9, 12:14 pm, pychicot <pychicot...@nike.eonet.ne.jp> wrote:
> Aren't ”senior” and ”subordinated” contradictory?
> Or, are there any ジュニア劣後債？

No, they aren't contradictory. "Subordinated note" refers to the
entire class of subordinated debt. Within this class, there can be
junior and senior pieces. First non-subordinated debt is paid off,
then senior subordinated debt, and then junior subordinated debt.

--Franzi Dickson

[jmarc...@comcast.net]

Keiko Kurihara asked:

what is "senior subordinated note"?

シニア劣後債？

Aren't ”senior” and ”subordinated” contradictory?
Or, are there any ジュニア劣後債？

Keiko,

Without claiming any expertise in this area myself, it appears that even though senior debt and subordinated debt (junior debt) are often used in contradistinction, it is not as simple a matter as that:

http://financial-dictionary.thefreedictionary.com/Subordinated+Debt

So there is both senior subordinated debt and junior subordinated debt, and your notes must fall under the former.

Hope this provides some clues,


John Marchioro

[William Taylor]

A quick google check shows that Reuters and Pimco use both the terms シニ
ア劣後債 and ジュニア劣後債.
This would suggest that these terms are commonly used in the Japanese
language in this field.
Also got some hits for 優先劣後債 for senior subordinated debt.
Not a contradiction, just a way of ranking.
Best of luck!

Regards,
William Taylor
Colombo, Sri Lanka

[pychicot]

Thank you for all the answers.
these helped me a lot.
I understand that "senior" suggests just "ranking".

BTW, Tender Offer usually means 株式公開買付
What I am handling now is cash tender offer for subordinated note.
Is this 債券公開買付?
If so, what's tha purpuse? also for M&A? I wonder...

Thanks in advance.

Keiko Kurihara

[William Taylor]

Keiko writes:
> BTW, Tender Offer usually means 株式公開買付
> What I am handling now is cash tender offer for subordinated note.
> Is this 債券公開買付?

That sounds reasonable.

> If so, what's tha purpuse? also for M&A? I wonder...

The purpose could differ depending on who is doing it.
If the company who originally issued the bonds is conducting the
tender offer they might be doing so for the purpose of refinancing and
taking advantage of lower interest rates or more favorable terms.

[Andreas Baranowski]

Yes, it is 債券公開買付. Tender offers for own debt are used when the debt
issue is not or not yet callable and the issuer wants the debt out of
the way, perhaps for the sake of an enhanced capital structure because
the entity is to be spun off and separately incorporated.