Apple Responds to Einhorn's Criticism
In a direct response to Greenlight Capital's David Einhorn, who proposed the creation of a preferred share class, Apple has issued a statement on its cash balance. The Mac maker acknowledged that by early 2012 its cash position was well beyond what it needed for operations, including what it wanted on hand for strategic opportunities.
That was among the reasons it instituted a dividend and share repurchase program last year that would return $45 billion to shareholders over the course of three years. (As of next week, the company said, it will have executed $10 billion of that plan.) Apple said management and the board continue to have active discussions about returning extra cash to investors, including reviewing Greenlight Capital's proposal. The company said it will "thoroughly evaluate" Einhorn's idea, and welcomes views from all shareholders.
The company also clarified that the Proposal No. 2 up for a vote, which Einhorn opposes, only covers the issuance of "blank check" preferred stock that doesn't require shareholder approval. Even if the proposal is adopted, the company would still be able to issue preferred stock subject to shareholder approval.
As of this writing, shares are up $15, or 3.3%, following the statement.
The article Apple Responds to Einhorn's Criticism originally appeared on Fool.com.Fool contributor Evan Niu, CFA, owns shares of Apple. The Motley Fool recommends Apple. The Motley Fool owns shares of Apple. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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