Share with subscription warrant

A share with subscription warrant (OBSA — Obligation à Bons de Souscription d'Actions) is a compound instrument combining a bond and detachable share subscription warrants. Unlike convertible bonds (conversion is an either/or), the bond and warrants can be traded separately after issuance. In financial structuring and fundraising, they offer bond principal protection combined with call option upside. Their valuation requires bifurcation: the bond component (DCF at credit-adjusted rate) and the warrant component (option pricing model).

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Example: a Swiss medtech company issues CHF 3.0 million of OBSA at 4.0% coupon with warrants exercisable at CHF 150/share over 3 years. Bond component value: CHF 2.6 million; warrant value: CHF 400,000. Warrant exercise represents 8% potential dilution of current capital — modelled in the cap table for the next fundraising round.

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Hectelion values OBSA and their warrant components for IFRS accounting, tax and transaction purposes.