If they really wanted that dividend, they could see that the company is doing $X in buybacks, figure out what percent of its market cap that works out to, sell a corresponding amount, and pretend it's a dividend.

A lot of shareholders also DRIP, but they should prefer buybacks for tax reasons.

depends how sophisticated the investor in the story is. it thay are perfect homo economicus they would have been selling some of those inflated shares to do what they would have done with the dividends

Shareholder prefer buybacks for tax reasons.

He didn't say it was exactly same, only that in principle it's the same - company returning money to shareholders.

Such an action has no effect on company valuation.