Publications
Publications
- December 2010 (Revised June 2011)
- HBS Case Collection
Boston Properties (A)
By: Ryan D. Taliaferro and Aldo Sesia
Abstract
Investment manager Eliza Baena confronts an apparent convertible bond arbitrage opportunity when she notices a narrowing spread between two Boston Properties (BXP) bonds, one a convertible bond and the other a straight bond, in the wake of the 2008 Lehman bankruptcy. Baena must decide if there is an opportunity, how to structure a trade to exploit it, and how much of her fund's capital to allocate. Case exposition includes descriptions of basic financing arrangements that support arbitrage strategies, such as rehypothecation and margin lending.
Keywords
Citation
Taliaferro, Ryan D., and Aldo Sesia. "Boston Properties (A)." Harvard Business School Case 211-018, December 2010. (Revised June 2011.)