02.05.2013 15:28:00
|
Moody's: Dividend Recaps Don't Change the Equation for Investors in the Event of Default
New York, May 02, 2013 -- When US companies default on their debt after completing debt-funded dividend recaps, investor recoveries at the corporate family level are consistent with the historical average for all US non-financial corporate defaults, Moody's Investors Service says in a new report. Although dividend recaps weaken credit quality, the view that they "hollow out" companies is not borne out by recovery data.