Assignment

You are the CEO of a company and are getting pressure from the Board of Directors regarding company performance. The company's shareholders are not happy because performance, as measured by ROE, has been below the industry standard. There are several potential investments that can help improve company performance, but will require more capital in order to invest in them. You have the decision to raise either debt, equity, or some other combination to obtain the capital required for the projects. However, recently the credit rating agencies have downgraded the company's debt rating due to high leverage ratios and declining profit margins. The bondholders are getting nervous because the current rating is BBB, and they don't want to lose investment grade status. Recent bond prices have dropped due to the credit downgrade.
Please describe how you would raise capital and how it will affect each of the stakeholders. Please defend your decision by telling us why you made your decision.