Companies engage in share buybacks (a.k.a. shares repurchases) as an alternative or complement to paying dividends as a means of returning capital to shareholders. Many companies establish formal share buyback programmes, during which time they buy shares back from the open market. As no cash is distributed to investors, buybacks offer shareholders tax advantages over dividend payments. The act of buying back shares reduces the number of shares in circulation and over time is likely to increase the share price. The act of buying back shares also mechanically increases earnings per share (as there are fewer shares in circulation). Some companies have anti-dilution policies so buy back shares to neutralise the impact of share option exercise. Shares that have been bought back can either be cancelled or held as treasury stock (cf.).