
Easyjet seeks state loans – but pays Stelios £60m - DyslexicAtheist
https://www.thetimes.co.uk/article/easyjet-seeks-state-loans-but-pays-stelios-60m-d26jghjtx
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rahimnathwani
Elsewhere I read that the company's CEO and/or another spokesperson said that:

\- the company is legally required to pay the dividend

\- the company is looking for a 'commercial loan'

I don't understand the latter part. I read 'commercial loan' as a loan on
commercial terms, which would include pricing in the risk of default etc. If
that's what they mean, then why does the government need to provide the loan?
Why not borrow from a commercial bank or issue bonds in the normal way?

If the answer is 'no one will lend', then the rate the government charges
should be very high indeed (infinite?). If the answer is 'too expensive', then
the government's price should be too expensive, too.

What am I missing?

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redis_mlc
> \- the company is legally required to pay the dividend

That's a new one to me, and I've been following the financial press for
decades.

It could mean that the dividend was previously decided at a board meeting and
announced to shareholders already, and they want to follow through to avoid a
securities investigation.

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rahimnathwani
If you had sold your stock the day after the shares went ex-dividend (a few
weeks ago), you would have believed that:

\- you will receive the dividend

\- you will have no other financial upside/downside from easyjet's performance

If the dividend were to be cancelled, then this would transfer wealth from you
(a past shareholder) to current easyJet shareholders.

Rules changing after you have made a trade isn't how financial markets are
meant to work, because it reduces incentive structures.

I'm not saying what should happen in this case. Just pointing out that
cancelling a dividend for shares that have already gone ex-dividend seems like
it would require a lot of work to make sure that the money comes from current
shareholders, and not past ones.

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flashyfaffe2
Clearly easyJet play the dirty game of privatising profits and nationalising
losses. They have the right to have objective to give dividend. However no
reason why the tax payer should bear their management decisions. If they need
loan then let investors do their duties...or not.

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stuaxo
Sign of the times, just a month ago this headline would be on the guardian,
never on this paper.

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pottertheotter
Can you explain what you mean by this? I am not familiar with the context.

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thazework
The Guardian is read by people who think they ought to run the country, the
Times is read by people who actually do run the country.

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thazework
Thought i might as well add the reference.
[https://youtu.be/DGscoaUWW2M](https://youtu.be/DGscoaUWW2M)

