Hedge fund manager David Einhorn of Greenlight Capital told Reuters on
Thursday that he "chatted yesterday" with Apple CEO Tim Cook who is
receptive to his proposals on Apple's capital allocation strategy.
said he suggested to Apple an initial preferred share distribution,
where dividends could be funded on an ongoing basis by a relatively
small percentage of the company's operating cash flow.
better than a big stock buyback because it doesn't deplete the company's
cash right away, which the company seems to want to keep," Einhorn said
earlier on Thursday.
Apple had $137.1 billion in cash, short-term
and long-term marketable securities at the end of last year, but more
than $94 billion in that cash is parked overseas.
Reuters that Apple Chief Financial Officer Peter Oppenheimer and his
advisers rejected his idea in September 2012. He added the company then
refused to withdraw a proposal - outlined in Apple's annual proxy
statement - to eliminate preferred stock from its charter.
that the proxy came out and we saw they were planning to get rid of
preferred - and then, we said, 'Wait a minute, we are not going to be
able to bring this up again in a good way if we allow them to do this,'"
Einhorn said. "So we should contest it now."
Greenlight sued to block the measure, asking a federal court in Manhattan to bar Apple from certifying votes cast in its favor.
said: "When I discussed this with Tim Cook, and actually, the
conversation has been going on for the last couple of weeks, he said
that he wasn't familiar with my previous conversations with Peter
Oppenheimer and whoever Peter Oppenheimer's advisers were. I was
surprised by that."
Einhorn said Cook is receptive to his proposals and added that Cook's advisers "want to come and meet with me."
© Thomson Reuters 2013