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French to English translations [PRO] Bus/Financial - Investment / Securities
French term or phrase:titre (au cours de 28/29 €)
L’augmentation de capital dédiée devrait se traduire par une création de 2,5 M nouveaux titres X, soit une somme de 72 M€ au cours de 28/29 € (estimés).
Unless I am reading this wrong again, after this merger there is an increase in dedicated capital leading to the creation of 2.5 million new certificates or securities... which means a sum of 72 million euros expected to happen 'during' 28/29 as in years rather than euros? What am I missing here?
Explanation: I'm no financial expert, so couldn't hope to give you the definitive wording for this... but surely it means that this share issue would raise €72 m if one assumes they will be trading at € 28-29. 'cours' * 'rate' as used in, for example, 'foreign exchange rate' (cours des devises.
Note that 2.5 × 28.8 = 72.
I'm sure my interpretation of the financial situation may well be a bit off, but I think the underlying idea is along the right lines.
-------------------------------------------------- Note added at 13 mins (2009-11-16 23:39:39 GMT) --------------------------------------------------
OK, so Mark's the expert and has got the right answer here — but I'm glad my thinking was at least going in the right general direction!
-------------------------------------------------- Note added at 7 hrs (2009-11-17 07:18:05 GMT) --------------------------------------------------
From Robert + Collins:
cours d'ouverture ( Bourse ) : opening price cours de clôture , dernier cours : closing price | latest quotations cours des devises ou du change : foreign exchange rate au cours (du jour) : at the price of the day au cours du marché : at (the) market price le cours des voitures d'occasion : the (selling) price of secondhand cars
-------------------------------------------------- Note added at 12 hrs (2009-11-17 11:56:14 GMT) --------------------------------------------------
That's always the trouble with dictionaries... ;-)
It seems like 'capital dedié' should mean the capital is dedicated to the acquisition, which it is, but that is not what 'capital dédié" means here. Capital dédié/dedicated capital here is just a set term, and means what the dictionary definition below says.
Also, about nominal value, the term theoretically exists as a synonym for par value, however this is another situation where professional jargon varies from laymen's speech. I have never, in decades working in stocks/bonds/investments seen another term besides 'par value' used in the real World of serious equity trading.
The reason for this is that nominal value also means something else to economists and financial people. The term Nominal Value of an equity is the opposite of the real value as adjusted over time, not just as contrasted to the current market price. (I think I mentioned it was complicated below).
The nominal/real value distinction can apply not only to time-series data, but to cross-section data.
This is difficult to explain in the characters allowed here, but if you google 'nominal value vs. real value' or something like that you should get an explanation.
Augmentation de capital does not mean 'capital increase'. There is no such term in English. It is a widely used mistranslation. You will find it in no financial dictionary or glossary. Mr Killingsworth and I agree to disagree on this. The term 'augmentation de capital very explicitly means a secondary equity offering, a seasoned equity offering, (issue) new equity, issue fresh equity, in this context. It is completely explicit and this sentence does not make sense if you don't understand that.
It is important to note here again, that in France the company must get shareholder permission to issue new equity. In the US they do not unless it is written in the by-laws.
A dictionary definition of:
Dedicated capital Total par value (number of shares issued, multiplied by the par value of each share). Also called dedicated value.
It has nothing to do with what
Please note that using the term nominal value is incorrect. It must be 'par value'. This value can be adjectivally described as nominal, but the term invariably used (US) id par value. US finance people will probably misunderstand, or not understand at all, if you use 'nominal value for par value. (cont'd)
It's the augmentation that is dédiée, not the capital. What you usually see is 'augmentation de capital dédiée à la croissance' -- meaning, it's not dilutive, we promise.:-)
The thing that I have trouble grasping is that dedicated capital is usually defined as the total number of shares multiplied by their nominal value. However, you hear, "XXX is looking to raise new capital with the issue of (number) new shares with a nominal value of $$ (a fixed value usually much lower than the actual share price). These shares are then sold at a certain price - such as the average share price during the week prior to the issue. And so there are two figures relating to the capital increase: the number of shares multiplied by the nominal value and the number of shares multiplied by the price that they were sold at. What I have never quite grasped is how these figures relate to each other in French/English accounting terms.
Augmentation de capital does of course mean 'capital increase'. The company must first get shareholder authorization to increase the capital stock by 2.5m shares; only then can it issue the new shares and sell them to raise the estimated €72m. Dédiée means simply that the new shares are earmarked to pay for the acquisition. Yes, the company probably intends to make a secondary offering, but that detail is not explicit and you can't be certain. If they sell all the new shares to, say, Prince Alaweed, that would be a private placement, not a secondary offering, which is by definition public.
I think I should probably also add that the term 'nominal value' is not used in (US) English in way used in the other answer. What the French call 'valeur nominale' is called 'par value' in English for stocks, and 'face value' for bonds. This, like augmentation de capital, is very, very commonly mistranslated from French into English. So often that, like 'augmentation de capital', translators who do not also have experience working in equities and bonds, will argue stridently because they have seen the term mistranslated so frequently.
The "nominal value" of an equity in professional US financial parlance is something else, not its 'par value', something complicated.
Also, you are very wise to have researched this. Secondary equity can be very, very contentious in the US, because it is usually 'dilutive', which means that the old shareholders own a smaller percentage of shares when new equity is issued. It is not so contentious in France because certain legislation protects the old shareholders by law. So you are dealing with an issue of importance that if mistranslated/misinterpreted could have material, adverse consequences, and some one very angry at a translator.
"Augmentation de capital" rears its ugly head again. "Augmentation de Capital' sounds like it should just mean an increase in capital, but it does not when used by French financial professionals. It means 'a secondary equity offering", "New/Fresh Shares Offering", "seasoned offering". I initiated a spirited debate about 'augmentation de capital in a recent Proz item.
"Augmentation de Capital" (and Kapitalerhöhung) are probably the single most widely mistranslated finance terms out there. (See Wikipedia entry for "seasoned equity offering" wikipedia.org/wiki/Capital_increase) The term almost always does not mean just an increase in capital, but specifically capital increased by a secondary equity offering.
So, if you understand that "augmentation de capital" does not mean an increase in capital, but a secondary equity (share) offering, this will make sense.
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Answers
11 mins confidence: peer agreement (net): -1
titre in this context in conjuction with 28/29 €
securities with a nominal value
Explanation: dedicated capital = number of shares multiplied by nominal or par value of each share. So 2.5 million multiplied by a price of ("au cours de") 28/29 euros gives dedicated capital of 72 million euros.
Mark Nathan France Local time: 21:52 Native speaker of: English PRO pts in category: 4
Notes to answerer
Asker: I knew I was reading this wrong... Thank you so very much! I had never seen 'au cours de' used this way, either, I must admit, but usually in the context of time elapsing. And the Robert did not help this time at all...
Asker: With or without the nominal value, my final response was a mixture of your response and Tony's. The truth is that all your thoughtful comments on some of these questions gave me an actual understanding of the subject...