Two part question
In a tax less world with no brokerage coasts, repurchases and dividends have the same effect on shareholder wealth. In the real world, however, repurchases provide more preferable tax treatment than dividends to ordinary investors. Does this mean that firms should always use share repurchases so that investors can gain from this tax benefit? Y/N?
Is it necessary for firms to repurchase stock only on the open market through a tender offer, under which it permits stockholders to send in their shares at a predetermined process? Y/N