Share repurchase and the cost of capital: Discussion on the nature of share repurchase of Chinese listed companies.

ABSTRACT: Share repurchase is not only an important financial policy of the company, but also a financial policy with a very wide range of influence. A scientific and reasonable share repurchase policy has a significant financial effect in terms of an equity structure optimization, capital structure adjustment, cash holding control, and even management compensation system design. The long-standing share repurchase in the U.K. and U.S. companies and the recent practice of share repurchase by Chinese listed companies imply an important financial proposition: share repurchase is a high-quality financial policy that, when properly applied, will help reduce the cost of capital. The data in this study show that share repurchases can reduce the level of firms' cost of capital and play an important role in

SUBMITTER: Wang P 

PROVIDER: S-EPMC10538758 | biostudies-literature | 2023

REPOSITORIES: biostudies-literature