A method of returning excess
cash to members
by the creation and issue of a new class of shares
(‘B shares’) to members in proportion to their existing holdings, followed by the payment of a dividend
on those shares, the redemption or buyback of those shares for cash, or the shares being cancelled in a reduction. Depending on the exact method chosen, shareholders may be able to treat the gain as either income or capital. See also special dividends, share buyback and reduction of capital.
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