tjh290633 wrote:My view about share buy-backs is that they should always be done by tender offer to the shareholders, rather than in the market. That way, shareholders who wish to sell some or all of their holdings can do so, while those who do not can hold onto their shares.
In any case, if they wish to return cash to their shareholders they have the option of a special dividend.
Tenders are too expensive for very obvious and sensible regulatory reasons. And why can shareholders not sell some or all of their holdings in the market? This is a completely mistaken premise.
Buy-backs do not benefit the shareholders, only the incentive scheme holders.
I'd recommend that anyone tempted to take this at face value read previous threads where TJH has made a similar statement and others have provided a very well reasoned rebuttal.
[My view: so what? If the shareholders are stupid and approve a buy-back not in their interest then let them be punished for their stupidity. OTOH if the shareholders are smart and approved the buyback then it must logically be in their interest to some extent, not "only" in the interest of the incentive scheme holders -- if such a scheme even exists for the company in question.]
GS