game is on, page-16

1. "less shares holders to pay dividend to".
By buying back shares at a premium, the shareholders that sold out gets a "dividend". People who are no longer shareholders actually benefit. There is also then less cash to pay out more dividends to existing sh.

2. "less shares on market for buyers to chase"
Shares would have been bought by true believers who are long-term investors and effectively quarantined those shares from the market.

3. "If a company has surplus cash, what can they do with it?"
Buy more assets, speed up projects ...