Ralph Nader letter: unsafe at any speed
#23
#24
Gets Weekends Off
Joined APC: Jun 2008
Posts: 3,716
Simply put, management stock bonuses are based on their total percentage ownership of the company. So if management owes 1% of the company throught stock agreements, and they blow $1B to buy back 10% of the shares, they now own 1.1%, so they get a 10% increase in their stock bonuses. They are essentially using company profits to buy themselves a higher percentage ownership of the company. Its like dilution in reverse.
Once all the shares have been repurchased, only management will own shares. Effectively they could BUY all of United and own it, using the profits we generated to benefit them.
None of this helps the company later if we have financial difficulties. When they talk about doing this to benefit "shareholders", the only shareholders they want to benefit are themselves.
Once all the shares have been repurchased, only management will own shares. Effectively they could BUY all of United and own it, using the profits we generated to benefit them.
None of this helps the company later if we have financial difficulties. When they talk about doing this to benefit "shareholders", the only shareholders they want to benefit are themselves.
#26
Gets Weekends Off
Joined APC: Aug 2013
Position: FO
Posts: 627
As a stockholder, not of UCH, but in general, I hate stock buybacks because it artificially increases value. The value of the stock will still fluctuate based on other investors inputs. I would much rather see a dividend payout and investment in the infrastructure of the company. It really is a poor use of capital, especially when the company will turn around and leverage itself through debt to purchase and refurbish planes.
#30
It's the messenger.
It would have been very interesting to see how different the pilot reaction to that letter would have been if the author's name had not been revealed.
Or, even better, if it had been signed "H. Ross Perot".
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