The buyback includes a one-time preferred dividend of approximately $1.64bn which will be reflected in the Goldman Sachs’s first quarter results and is expected to reduce reported diluted earnings per common share for the first quarter by approximately $2.80 per share.
The redemption is expected to take place on 18 April.
The transaction will accelerate the $24m of preferred dividends payments that is scheduled to be paid from 1 April to the redemption date, and is expected to reduce reported diluted earnings per common share for the first quarter by approximately $0.04.
Goldman Sachs said that the it incurred a dividend expense of $125m per quarter, or $500m annually, which reduced diluted earnings per common share by $0.85 in 2010.
However, Berkshire Hathaway will continue to hold the warrant to purchase 43,478,260 shares of the Goldman Sachs common stock, par value $0.01 per share, which it purchased concurrently with the preferred shares on 1 October 2008.
