Which of the following is NOT a typical use of treasury shares?

Treasury shares, or repurchased shares that are held by the issuing company, are typically utilized for various strategic purposes. One such purpose is funding employee benefits programs, as companies often use these shares in employee stock ownership plans or as incentives tied to performance.

When considering acquisition financing, treasury shares can facilitate mergers and acquisitions by allowing the company to use these repurchased shares as currency in transactions. Similarly, companies may utilize treasury shares as a defense against hostile takeovers, as repurchasing shares can reduce the number of shares available in the market, potentially making a takeover more challenging.

In contrast, increasing dividend payouts is not a typical use of treasury shares. While dividends are often paid out of retained earnings or profits, they are typically issued to shareholders in the form of cash or additional shares, rather than being funded through treasury shares. These shares represent stock that the company has already bought back and thus is not available for distribution to shareholders. Therefore, using treasury shares for dividend payouts does not align with how companies manage equity and distribution.