Ford Motor Co. has caught up on payment preferred stock dividends, which it had skipped for 14 months, and may resume common stock payouts by 2012 — a year ahead of previous predictions,
Bloomberg reported.
The company must pay off more of its debt, which totals about $27 billion, before it can resume the common stock dividend, the report noted.
Ford removed a key legal hurdle to the divident by paying $255 million in deferred dividends on its Capital Trust II preferred stock, along with a $3.8 billion payment to a trust for union retirees. Now that those dividends are paid in full and restored, Ford is free to reinstate a dividend on its common shares and Class B shares owned by the Ford family. The size of the payments — made ahead of schedule — shows the carmaker is confident it can generate cash.
(Source: Bloomberg, July 1, 2010.)
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