If the share price does not increase sufficiently for conversion to take place the company will have more expensive debt with a convertible bond than with unsecured borrowings.

Additional finance will be raised upon conversion of the convertible bond but not with unsecured borrowings.

The coupon rate of a convertible bond is likely to be lower than for unsecured borrowings.

If the convertible bond holders eventually convert to shares the company's gearing ratio will rise whereas it will be unaffected if finance is with unsecured borrowings.