Einhorn, whose Greenlight holds more than 1.3 million Apple shares, added the cash on the company’s balance sheet was like an inventory problem. IBM (NYSE:IBM) and Coca-Cola (NYSE:KO) had continued to grow for decades while issuing cash returns, he insisted.
Not everyone has been convinced by the suggestion. Rich Clayton of CtW Investment Group, which advises pension funds that own 2 million Apple shares, told Bloomberg that the tactics did not make much sense.
“Our concern is that Apple’s proposal is a very pro-shareholder resolution that is being hijacked,” Clayton said. He added he was also concerned that the 4 percent dividend yield suggested by Einhorn could fall if interest rates rose. “They’re being described as being similar to a long-term corporate bond, but there’s more risk,” Clayton said.
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