Conversion of loan to equity

Ruchie Khanna (Company Secretary) (123 Points)

27 August 2011  

Dear all,

X, an unlstd public Co. owes Y, an unlstd public Co. certian amount of debt. It is now proposed to convert this debt to equity. My query is - That at what value should this conversion take place? Should it be at Face Value or Fair Value??

Please help!!

Thanks in acticipation.

Regards,

Ruchie