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liquidating dividend

   Also found in: Wikipedia 0.03 sec.
Liquidating dividend
Payment by a firm to its owners from capital rather than from earnings.

liquidating dividend
A pro rata distribution of cash or property to stockholders as part of the dissolution of a business. For example, a firm may be liquidated because the officers believe its stock price does not adequately reflect the value of its assets. All debts and other obligations usually must be satisfied before issuance of a final liquidating dividend. A stock paying a liquidating dividend is indicated in stock transaction tables in newspapers by the symbol C, next to the dividend column. See also final dividend, General Utilities Doctrine.

Liquidating Dividend
A dividend paid to shareholders out of a company's capital or assets, rather than its earned income. That is, a liquidating dividend occurs when a company pays more than its total profit in dividends. This usually happens when shareholders believe that the company is no longer sustainable or profitable. Therefore, liquidating dividends are considered a return of shareholders' investments, rather than profit on them. All of the firm's debts must be paid before it can pay liquidating dividends. See also: Final dividend.


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Only 21% of the target's assets were acquired with the acquiring corporation's stock; the remaining 79% were acquired as a liquidating dividend of the previously held stock in the target.
03 per share second liquidating dividend to stockholders of record on Aug.
09 per share second liquidating dividend to stockholders of record on August 26, 2003.
 
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