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From the article at least - the pre-agreed dividend (a thing I had no idea existed) is so onerous on the company that it can't keep up with payments. So the co
by munk-a 5y ago
From the article at least - the pre-agreed dividend (a thing I had no idea existed) is so onerous on the company that it can't keep up with payments. So the company is being forced to sell off long term investments and assets for a quick buck just to cover the dividend it's agreed to pay.
It's like saying: "Hey, I've got an ice cream stand that I make 50$ of a week and has capital assets worth 200$. I wonder if I contractually agreed to donate 75$ worth of value every week - would that work well for me?"
- deleted 5y ago[deleted]
- draw_down 5y agoThat’s just rehashing what’s in the article. GP is not asking why the dividend is bad for the company.
- fy20 5y agoI wonder if there is something else going on, as this sounds like an awfully good way to cover up a sinking ship, yet still take money out for the stakeholders. In 5 years time when the company is bankrupt they can just come out and say the IPO was a bad idea, while the main stakeholders are sitting nicely in their gold plated Lamborghini's [0]. [0] I made that up, but turns out it is actually a thing: https://m.economictimes.com/nation-world/strange-things-saudi-princes-spent-money-on/when-money-matters/slideshow/56999098.cms https://m.economictimes.com/nation-world/strange-things-saud...