Manton wrote:

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There's a story at sports business journal about the Habs/George Gilett closing a 240 Million dollar deal in which Gilett will pay himself a 72 million dollar dividend.  The money will be used to pay off loans he took out to but the team.  I don't really understand all the ramifications but perhaps Mario or someone else can read it.  In order to access the story you have to sign up for a free trial period. www.sportsbusinessjournal.com

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Dicidends are paid to owners out of after-tax dollars.  Because the corporation pays income tax on its profits, dividends are taxed at a lower rate when they hit the owners' pockets.

If cash flow allows it, dividends are a good way for the purchaser of a business (in this case, Gillett) to repay the money he borrowed to buy the business by using the future profits of that very business itself.

Having said that, I haven't read the story..............