Magazine article The Spectator

Shares Not Alike

Magazine article The Spectator

Shares Not Alike

Article excerpt

Sir: Tim Congdon ('Keynesianism still isn't the answer', 25 October) doesn't fully understand the possibilities that preference shares can offer, which is a pity because his argument could be greatly strengthened. Preference capital can resemble a loan stock, and thus be treated like debt rather than capital, by being repaid on a fixed date; but it does not have to be redeemable. It is quite possible for it to be irredeemable and thus form part of the capital base. Classically, it would also be convertible into ordinary capital, so that the holder need not be tied into a fixed coupon permanently. The triggers for such an option to become exercisable would be predetermined and set out in the company's Articles of Association.

Preference shares could also acquire voting rights if, for example, dividends were missed. …

Search by... Author
Show... All Results Primary Sources Peer-reviewed

Oops!

An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.