Buying your own shares and then destroying them: in recent years this has become the symbol of a capitalism that is not running smoothly, a version of disheveled liberalism. Hence the surprise to see a boss who claims to be ” from the left “committed against the excessive remuneration of CAC 40 managers, defend this financial gymnastics.
“When a company treats its employees well and maintains investment capacity, there is nothing scandalous about buying back shares”insists Jean-François Rial, CEO and co-founder of Voyageurs du monde, who defines himself as a “child of the second left”. “This allows capital to be reallocated. The speed of circulation of capital is also the great strength of the American economy. »
Interesting practical case at a time when the government is considering introducing a levy on share buybacks of large companies, the French leader in tailor-made travel unveiled a massive share buyback project on Tuesday April 23. This OPRA (public share buyback offer) would concern approximately 20% of the capital of Voyageurs du monde, with the aim of canceling the securities contributed to this offer.
“It’s absurd to tax share buybacks”
“In 2021, during the Covid crisis, we raised 130 million euros in order to build up financial reserves, while our turnover had plunged by 85% in 2020”relates Mr. Rial. “This money fueled our cash flow. But the recovery in activity took place much faster than expected, allowing us to finance our development thanks to our results. Furthermore, we made a few acquisitions but we did not find a significant target. In other words, this money raised in 2021 is placed in monetary mutual funds and not in the productive system: it is of no use and it is normal that we return it to our shareholders who will be able to use it to invest in companies that need capital. »
Except, of course, insists Mr. Rial, that Voyageurs du monde retains an investment capacity, through a cash cushion of 100 million euros. “And we distributed 18 million euros to our employees in 2023, in the form of profit-sharing, profit-sharing and other bonuses, compared to a net result of 44 million euros”the boss justifies himself.
And this one to engage: “If you meet these criteria, it is absurd to tax share buybacks. It would even be counterproductive. Financiers are not philanthropists: if share buybacks are penalized, they will hesitate to provide capital in the first place. In such a punitive environment, in 2021, we would not have been able to raise funds. »