Shell stops scrip dividend program, switches emphasis to share buybacks

|By:, SA News Editor

Royal Dutch Shell (RDS.A, RDS.B) says it will no longer pay dividends to shareholders in the form of stock, effective with its Q2 dividend, instead putting its emphasis on buying back its own shares as well as paying dividends in cash.

The move ends inefficiencies created by Shell's dual share structure and Dutch tax rules, and should save the company money, WSJ's Helen Thomas writes; equally important, it suggests Shell is feeling confident about its cash flows.

In London, B shares fell as much as 3.2% to 2,470 pence, their biggest intraday drop in four months.

A shares +0.7%, B shares -3.2% premarket.