Tech giant looking to offset dilution using its strong cash position
WATERLOO, Ont.—BlackBerry has provided an update on its planned share repurchase program.
The company intends to purchase up to 12 million Blackberry common shares for cancellation. The shares represent about 2.5 per cent of the outstanding public float.
BlackBerry has announced two possible strategies for the buyback. First, via the Nasdaq Stock Market and second on the Toronto Stock Exchange, which would be subject to regulatory approval. The buyback would cost approximately $132-million on the TSX or US$106-million on the Nasdaq.
As of June 22, 2015, BlackBerry had 529,487,374 common shares outstanding, the public float was 464,726,304 common shares and the average daily trading volume for the 6 months prior to May 31, 2015 was 2,314,477. BlackBerry has filed a notice of intention to commence a normal course issuer bid with the TSX. Daily purchases will be limited to 578,619 common shares, other than block purchases. The purchases may commence on June 29, 2015 and will terminate on June 28, 2016 or on such earlier date as BlackBerry may complete its purchases pursuant to the notice of intention. In the past 12 months, BlackBerry has not repurchased any of its outstanding securities.
“As we’ve previously indicated, the purpose of this repurchase program is to offset dilution from our new employee share purchase plan and amended equity incentive plan,” said BlackBerry Executive Chairman and CEO, John Chen. “We intend to take advantage of our strong cash position to purchase our shares when the market price does not reflect what we view to be the underlying value and future prospects of our business, without adversely affecting our strategic initiatives,” added Mr. Chen.