What are the disadvantages of selling debentures?

Selling debentures can lead to several disadvantages for a company. Firstly, it increases the company's debt burden, which can negatively impact its credit rating and make future borrowing more expensive. Additionally, debenture holders typically have fixed claims on the company's assets and profits, limiting financial flexibility. Furthermore, the obligation to pay interest, regardless of the company's performance, can strain cash flow and affect operational stability.