The ability of listed companies to optimize their capital structure, shape their distribution policy and fight hostile takeovers by repurchasing their own shares

Daniel Schwarz ()
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Daniel Schwarz: Pan-European University, Slovakia

Entrepreneurship and Sustainability Issues, 2018, vol. 6, issue 2, 636-648

Abstract: The management of listed companies is faced with the decision to distribute the annual surplus to the shareholders in total or to reinvest it in order to achieve the company's goals in order to sustain the continued existence and growth of the company. In order to avoid a conflict of interest between the various parties of a stock corporation, compensation must be found so as not to jeopardize the company's goals and priorities. An optimization of the capital structure and a balanced dividend policy should contribute to the satisfaction of all stakeholders of a company. This article investigates the possiblity by using a share buy-back programm, a kind of capital reduction, as a strategic measures to reach both oft he goals. Sustainability in terms of financial stability should be at the forefront of management and ownership.

Keywords: Buy-Back Program; reconciliation of interests; capital reduction; optimal capital structure; distribution policy; hostile takeover (search for similar items in EconPapers)
JEL-codes: G32 G34 G35 G38 (search for similar items in EconPapers)
Date: 2018
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Persistent link: https://EconPapers.repec.org/RePEc:ssi:jouesi:v:6:y:2018:i:2:p:636-648

DOI: 10.9770/jesi.2018.6.2(12)

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