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Article: Tired of IDSs?(Income Deposit Security)
- Article from:
- Investment Dealers' Digest
- Article date:
- November 1, 2004
CopyrightCOPYRIGHT 2004 SourceMedia, Inc. This material is published under license from the publisher through the Gale Group, Farmington Hills, Michigan. All inquiries regarding rights should be directed to the Gale Group. (Hide copyright information)
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Finally getting used to income deposit securities? Well, don't get too attached. Instead, meet their replacement: traditional initial public offerings with a high-yield twist. Opting for simplicity, issuers such as Iowa Telecommunications Services Inc. are abandoning plans to use the complicated IDS structure in favor of traditional IPOs that include dividend features.
"There is still a significant market for yield products, but near term, the market hasn't digested the new [IDS] structure as well as people anticipated," said Dave Erickson, head of U.S. equity capital markets for Lehman Brothers. "I think this is just the evolution of the product's development."