iPrefs: Apple’s next innovative solution

Note: title contains sarcasm.


[ Apple (Homer Simpson) strangling its Shareholders (Bart Simpson),   description of photo above. Photo represents fictional characters. …]

Here is the presentation of iPrefs. It’s been dreamt up and presented by David Einhorn, founder and president of Greenlight Capital. iPrefs is the “class of perpetual preferred shares that Mr. Einhorn has called on the technology giant to roll out as a way to deliver more cash to its shareholders.”.

How would it work? “Apple would issue one preferred share, carrying a quarterly dividend of 50 cents each, for each outstanding common share.”.

Why is Einhorn proposing this? “his argument about why those securities made the most sense for returning the company’s $137 billion cash hoard to what he said were its rightful owners.”

Einhorn has a fair point, especially if you consider their dividend history.

All quoted information above comes from Deal Book of NYT (here).

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