Shares of AOL Inc. (NYSE: AOL), a global Web services company, are gaining in trading today after the company announced a $600 million buyback of stock and a special cash dividend of $5.15 per share.
AOL shares rose to an intra-day high of $34.10 in early trading today. At last check, the stock was trading 2.10% higher at $33.61 on volume of 1.11 million. AOL shares have gained more than 122% this year.
New York City-based AOL said that the buyback and special dividend are part of the company’s plan to return $1.1 billion to shareholders.
AOL plans to buyback the shares through an accelerated stock repurchase agreement with Barclays Bank using an earlier stock buyback authorization and an incremental $10 million, which was approved by the company on Sunday. The company will pay the $600 million at the start of the agreement and expects to receive shares throughout the rest of the year.
In addition to the buyback, AOL also authorized a special, one-time, cash dividend of $5.15 per share, which will be payable on December 14, 2012 to shareholders of record at close of business on December 5, 2012.
Tim Armstrong, Chairman and CEO of AOL, said that today’s announcement underscores AOL’s commitment to delivering value for its shareholders. Armstrong added that the company remains committed to creating and unlocking value for all shareholders through smart execution and disciplined management of its asset portfolio.
Artie Minson, COO and CFO of AOL, said that since becoming a public company in December 2009, AOL has demonstrated an ability to unlock and prudently manage its valuable asset portfolio, including tax assets, and today, the company has done both again by outlining a clear path to returning $1.1 billion in cash to shareholders, while putting in place a mechanism to ensure the preservation of its valuable tax assets.
Recent Comments