The Shareholder Distributions Handbook

22 Pages Posted: 20 Jan 2004 Last revised: 2 Oct 2009

Date Written: May 1, 2003

Abstract

Who, When, What & How? . . . In the face of recent events, dividend and share repurchase policies are now being rewritten:

Low interest rates and depressed equity returns put pressure on companies to increase shareholder distributions

A dividend renaissance is partly due to low yields elsewhere, and the perception of dividends as a safe haven in turbulent markets

Changes in accounting and public opinion have made conventional option-based repurchase programs much less attractive but new, accounting-friendly structures remain available

Open-market repurchase programs remain the best alternative to dividends and are especially appropriate for uncertain cash flows

Self tender offers (fixed price and Dutch Auction) remain the most effective mechanisms to create value through increased leverage or to signal an undervalued stock, or manage rapid change in ownership.

Keywords: Dividends, Share Repurchases, Share Buybacks, Shareholder Distributions, Recapitalizations, Self Tenders

JEL Classification: G35, G32

Suggested Citation

Pettit, Justin, The Shareholder Distributions Handbook (May 1, 2003). Available at SSRN: https://ssrn.com/abstract=463104 or http://dx.doi.org/10.2139/ssrn.463104

Justin Pettit (Contact Author)

Independent ( email )

United States
9146092011 (Phone)

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