Originally Posted by
winner69
A bit here:
At the end of the five years,THL asked its shareholders to contribute $50m towards an equity raise, which is remarkably close to the $48m cash paid out in unimputed fully taxable dividends. Had the company not paid the fully taxable component of the dividend, the increase in retained earnings would have made the equity raise unnecessary.
The sad part about this story is that while the shareholders received $52m in dividends, it was taxable. ........After the shareholders had stumped up $50m for the equity raise, they are left out of pocket by an amount approaching $17m compared to their situation had THL not paid the unimputed portion of the dividend,
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