Why are warrants less desirable than convertible debentures as financing devices for the creation of new common stock?

Question

Quizplus · Accepted Answer

Warrants are less desirable than convertible debentures as financing instruments for the creation of new common stock because there is no device for forcing investors to exercise warrants, the conversion of convertible securities erases debt on the balance sheet (and warrants don't), and warrants increase the equity of a firm when exercised but there is no change in debt.

Why Are Warrants Less Desirable Than Convertible Debentures as Financing