BlackBerry Stock Jumps Amid Share Repurchase Plan

Shares of BlackBerry Ltd BBRY were up more than 3 percent in Friday's pre-market session on the news of a new share repurchase program, recently approved by the Board of Directors.

The program, announced on Thursday afternoon, stipulates the repurchase of up to 12 million Common Shares, which represent approximately 2.6 percent of BlackBerry's outstanding public float.

The company will present a new employee share purchase plan and a proposed surge in the number of shares available under its equity incentive plan at its annual meeting of shareholders, to take place on June 23. If the shareholders approve the plans, "BlackBerry will file a notice of intention to commence a normal course issuer bid with the TSX," a press release states.

Related Link: BlackBerry Sale Now Less Likely In Near-Term, Wells Fargo Says

The company's Executive Chairman and CEO, John Chen, explained that the purpose of the repurchase program is offsetting the dilution that may result from the proposed employee share purchase plan and the changes to its equity incentive plan. "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," Chen added.

BlackBerry will pay the price dictated by the market at the time of the acquisition to repurchase its stock.

Shares of BlackBerry have fallen almost 6.5 percent year-to-date, while the S&P 500 has gained 3.5 percent.

Posted In: NewsBuybacksMoversjohn chen
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