Difference in use of Excess Cash in LBO
I've heard that there was outcry in the Dell deal that excess cash was used to pay for the LBO as opposed to paid out as a dividend. Why would care whether it went directly towards the deal or paid out as a dividend, in both cases, aren't we decreasing the amount they have to pay? At the end of the day the equity value will decrease by the dividend amount, so they would pay less right?
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