Re: Surprised nobody posted this here yet - SFL converts 2018 notes to common stock
Wonder if Hemen needed his shares back. At the time of the convertible note issue he agreed to lend shares to parties buying the bonds and shorting the stock as a hedge. He received a one time $1,000,000 for the share loan. With other problem assets such as Seadrill, he may want to sell some of the SFL stock which means unwinding the share loan.
Also, SFL may want the additional equity on its balance sheet to give it more flexibility in taking writedowns on its balance sheet. Or, it could be that they just prefer to know that it will convert and they will not be required to pay it back. A big downside of these convertible issues is that they are redeemed for cash at the worst possible times. When times are good and cash is available, they usually convert for shares. When times are bad and cash is tight, they want cash.