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Thank you, that was very clear. > if Class A gets a $1 dividend Class B must receive the same. Does this mean that companies cannot split into voting and non-
by yid 13y ago
Thank you, that was very clear.
> if Class A gets a $1 dividend Class B must receive the same.
Does this mean that companies cannot split into voting and non-voting stock without paying out a dividend?
- deleted 13y ago[deleted]
- repsilat 13y agoYou'd think so, but in practice it's the other way around. The decision to pay a dividend is effectively made by the voting shareholders, and the voting shareholders see paying a dividend as giving money away to the non-voting shareholders.
- gohrt 13y ago1. GOOG's stock structure specifically guarantees equitable dividens and even share price parity. 2. Directly voting seizing the economic value of minority shareholders is about the easiest deleliction-of-fiduciary-duty case to win.
- twic 13y agoWhen JumpCrisscross mentions a dividend, he means any dividend paid by the company in the future. There isn't a special dividend paid on splitting. Although sometimes there is. A few weeks ago, Vodafone got rid of its stake in Verizon, and did that by distributing some of the shares to its shareholders, and selling others and then distributing the proceeds. Effectively, there was a split and a dividend at the same time. As someone who is partly responsible for the sanity of market data in a financial application, i can tell you that my colleagues and i look forward to such manoeuvres with utter dread.