GADGET DESIGNER Apple has responded to a shareholder lawsuit over handing out part of its cash pile to shareholders.
Apple's fast growing hoard of cash, which grew by $23bn in the last quarter alone and now stands at $137bn, is causing the firm headaches as shareholders are asking for a larger return on their investment in the company. After hedge fund Greenlight Capital filed a lawsuit against Apple saying it should issue preferred stock, Apple said it will consider the hedge fund's proposals and might put them to a shareholder vote.
Apple took the unusual step of naming Greenlight Capital, a private hedge fund that holds a relatively small stake of approximately $600m in Apple. According to Apple, it will look into Greenlight Capital's proposals, which include the firm issuing preferred stock paying steady dividends that are insulated from earnings fluctations.
Apple said it will "thoroughly evaluate" Greenlight's proposals. Apple also said its suggested changes to the firm's articles of incorporation would not stop it from issuing preferred stock, adding that the changes would simply require wider shareholder approval to issue preferred stock.
Although Apple said it has already returned $10bn to shareholders, the firm's solid performance and cash generation abilities mean shareholders want more. Now that the company's share price has fallen by 30 percent since its $700 high, investors want to see steady returns rather than trade Apple stock for profits on its short term price swings. µ
For all the firm's hits there have been plenty of misses
Oracle founder has almost literally all the money in the world. But what does he spend it on?
Built-in cigarette lighter? Yes please
Kaspersky warns against charging via PCs, Macs and public charging stations