Uralkali to put up to $2.5 bln into buying back shares, GDR
MOSCOW. Oct 7 (Interfax) - Fertilizer-maker OJSC Uralkali is conducting at share and GDR buyback, aiming to boost company capitalization, into which it will be putting up to $2.5 billion from October 6 to the same date next year, a company statement says.
The Uralkali board of directors approved a buyback program involving the company's ordinary shares, which have par value of 0.5 ruble, and its global depository receipts.
The company's stock got a nice bounce on the news of the buyback. By 11:58 a.m. Moscow time, Uralkali stock had jumped 6.7% from Thursday close to 240.2 rubles per share.
The acquisition of shares and GDR will be effected by CJSC VTB Capital, CJSC Troika Dialog, its affiliates as brokers on the basis of market quotations, and also Uralkali subsidiary Enterpro Services Ltd. directly under option agreements conferring the right to acquire shares and receipts at a fixed price. The stock will be acquired in Russia, the GDR on the London Stock Exchange at the prevailing current market price.
Financing for the program will be done with Uralkali's own monies and loan funds.
If the necessary corporate approval is secured, when the buyback program is over Uralkali plans to cancel the acquired shares.
The program reflects the company's conviction of the need for a balanced approach to distributing investment in its development and funds returned to shareholders, factoring in support for stable capital structure, the statement says. The company thinks that in the long term such an approach will make it possible to create additional shareholder value.