Wednesday, August 1, 2012

Booz's $1 Billion Debt-Funded Dividend

The Board of Booz Allen Hamilton approved a $6.50 per share special dividend.  The $1 billion dividend is financed via $2.25 billion in various loans/credit agreements, i.e. a PEU "liquidity recapitalization." 

Flat revenue was due to a decrease in billable expenses and a lower rate of indirect expenses, reducing revenue under cost reimbursable contracts, it said.

How much will rising interest expenses bring under "cost reimbursable contracts," which I imagine are mostly with Uncle Sam?   PEU's hate to pay taxes, but love paying tax deductible and cost reimbursable interest.  It's the state of PEU's, beloved by Red and Blue.