What Are the Advantages and Disadvantages for American Semiconductor to Forgo Their Debt Financing and Take on Equity Financing?

American Semiconductor, Inc. is a relatively new business that "provides custom and standard processing services to fabless and IDM companies and researchers." With the deregulation of certain markets and increasing environmental concerns, the company operates in a rapidly changing business environment. The prospects of American Semiconductor's products are frequently reviewed, as with any organization, and the company's strategy is constantly analyzed. Therefore, the business decided to relinquish their debt financing and acquire equity financing; a decision that is not advantageous for a privately owned organization unless the owner wishes to give up total control of the business.…