In today’s briefing:
- Companies with More Cash on Hand Are Expected to Use Cross-Shareholdings to Repurchase Shares
Companies with More Cash on Hand Are Expected to Use Cross-Shareholdings to Repurchase Shares
- Stock sale allows brokers to pass on to the company the attraction of being able to diversify its shareholders, and the cross-shareholding sales scheme allows them to obtain higher commissions.
- One of the solutions that companies have come up with in the absence of improved return on capital is to reduce their policy shareholdings.
- The use of share repurchases to buy back cross-shareholdings is a very good way to improve return on capital because it also reduces the amount of cash on hand.
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