Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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![Friday, April 16th, 2021, Top Glove Spends RM1.42b on Shares Buyback. The world's largest rubber
glove maker, Top Glove Corp Bhd, has spent RM1.42 billion since September last year on buybacks after it
proposed a bonus issue of up to 5.48 billion new shares on July 2020, on the basis of two bonus shares for one
existing share in the rubber glove manufacturer, to reward its shareholders and enhance trading liquidity of its
shares. This year alone, Top Glove has bought back 23.79 million shares with prices ranging between RM5.78 and
RM6.15. In total, the glove maker has paid RM141.8 million for the buybacks, retaining 23.79 million units of
shares. (Excerpt from https://themalaysianreserve.com/.)
(b)
Based on the situation above:
i.
Explain the type of dividend payment implemented by top glove and the advantages of the action taken.
ii.
Discuss any other THREE (3) types of dividend payment method that can be implemented by Top Glove.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fbfcfa2c3-c358-4827-b757-f719867488b8%2F79a5096b-d437-4e0f-bcaf-08b2b7a63f10%2Fg4fqpu_processed.png&w=3840&q=75)
Transcribed Image Text:Friday, April 16th, 2021, Top Glove Spends RM1.42b on Shares Buyback. The world's largest rubber
glove maker, Top Glove Corp Bhd, has spent RM1.42 billion since September last year on buybacks after it
proposed a bonus issue of up to 5.48 billion new shares on July 2020, on the basis of two bonus shares for one
existing share in the rubber glove manufacturer, to reward its shareholders and enhance trading liquidity of its
shares. This year alone, Top Glove has bought back 23.79 million shares with prices ranging between RM5.78 and
RM6.15. In total, the glove maker has paid RM141.8 million for the buybacks, retaining 23.79 million units of
shares. (Excerpt from https://themalaysianreserve.com/.)
(b)
Based on the situation above:
i.
Explain the type of dividend payment implemented by top glove and the advantages of the action taken.
ii.
Discuss any other THREE (3) types of dividend payment method that can be implemented by Top Glove.
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