Gypsy Swap

Posted in Finance, Accounting and Economics Terms, Total Reads: 423
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Definition: Gypsy Swap

It is a method to raise capital without issuing any new debts nor holding a secondary offering. The common share-holders are asked to trade in their common stock with restricted shares. The freed common stocks can then be traded and be used to raise extra capital. Restricted share are generally provided to executives and are non transferable in nature.

They however can have some tax benefits. The newly freed shares can be traded at prices which may be higher or lower than the present market price.


Companies uses it a last resort to raise capital as the new and old investor require special packages to accepting the deal and beside raising debt and equity are comparatively easier options.

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