Information giant Thomson Reuters (TSX / NYSE: TRI) has announced that it plans to buy back up to an additional US$1 billion of its shares under a new repurchase program. The new buyback program is in addition to the US$500 million repurchase program that Thomson Reuters announced in May 2018. Thomson Reuters has repurchased approximately US$231 million of shares since resuming buybacks last month.
Repurchases under the combined US$1.5 billion buyback programs would allow the company to reduce the size of a contemplated US$9-10 billion substantial issuer bid/tender offer (SIB) that Thomson Reuters plans to make to all shareholders in connection with the sale of a 55% interest in the company’s Financial & Risk business, as previously announced.
The SIB may be at a premium to the then-current market price of the company’s shares. The company’s principal shareholder (Woodbridge) is expected to participate pro rata in the SIB.
Under the NCIB, shares may be repurchased in open market transactions on the TSX, the NYSE and/or other exchanges and alternative trading systems, if eligible, or by such other means as may be permitted by the TSX and/or NYSE or under applicable law, including private agreement purchases if Thomson Reuters receives an issuer bid exemption order in the future from applicable securities regulatory authorities in Canada for such purchases. The price that Thomson Reuters pays for common shares in open market transactions is the market price at the time of purchase or such other price as may be permitted by the TSX. Any private agreement purchases made under an exemption order may be at a discount to the prevailing market price. On June 5, 2018, there were 706,108,129 Thomson Reuters common shares outstanding. Any shares that are repurchased are cancelled.
From time to time when Thomson Reuters does not possess material nonpublic information about itself or its securities, it may enter into a pre-defined plan with its broker to allow for the repurchase of shares at times when the company ordinarily would not be active in the market due to its own internal trading blackout periods, insider trading rules or otherwise. Any such plans entered into with the company’s broker will be adopted in accordance with applicable Canadian securities laws and the requirements of Rule 10b5-1 under the U.S. Securities Exchange Act of 1934, as amended.
Decisions regarding any future repurchases will depend on the timing of the closing of the proposed Financial & Risk transaction and other factors, such as market conditions, share price and other opportunities to invest capital for growth. Thomson Reuters may elect to suspend or discontinue share repurchases at any time, in accordance with applicable laws.