Share Buybacks That Pay Back In Spades

Hedging techniques are earning millions in tax-free income for savvy companies

Thousands of companies have gone into the stock market in recent years to buy back billions of their own shares. But perhaps only 100 or so have turned to savvy hedging techniques that help execute those buybacks--and earn tax-free millions to boot. Dell Computer Corp. has saved itself about $1.6 billion in the last two years. Microsoft Corp. reaped $600 million in the past three-and-a-half years. Smaller fry are playing too: Appliance-maker Maytag Corp. netted $10 million over the past year.

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