JUMBO TROUBLE FOR TEXACO
Will European investors shun corporate America in 1986? The $11.1 billion awarded against Texaco in a US court may have far-reaching effects for all US corporate borrowers. Texaco’s two jumbo convertible Eurobonds, the 11 3/4% and 11 7/8% deals, fell to a level around 95 after the December 11 ruling in Pennzoil’s favour, representing a 14-point loss over the preceding month. Bondholders–80% of whom are said to be Swiss investors–became the latest victims of the hyper-aggressive mergers and acquisitions industry.
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