Tegna Inc. Surges After $300 Million Stock Buyback and Increased Dividend
Tegna Inc., a TV-station operator, made announcements on Monday that sent its shares surging after hours. These include a $300 million “accelerated” stock buyback and a 20% increase in its quarterly dividend. The increase in dividend came after the termination of a merger deal with Standard General, a hedge fund, that was agreed upon last year.
Accelerated Stock Buyback
Tegna Inc. is repurchasing its own shares in an effort to reduce the number of outstanding shares in the market. As a result, each share owned will represent a greater percentage of the total ownership of the company. The intent is to increase the value of each share and, therefore, the overall value of the company.
The stock buyback is an “accelerated” program, meaning the company intends to complete the repurchase program in a shorter period. The company aims to complete the program in the first quarter of 2021.
Increased Quarterly Dividend
The company also declared a 20% increase in its quarterly dividend from $0.07 to $0.08 per share on its common stock. This move benefits the investors of Tegna Inc. and is a signal of the company’s strong financial position.
Return of Additional Excess Capital
In addition, Tegna Inc. executives announced that they are active in reviewing the return of additional excess capital that accumulated during the pending merger. This statement indicates that there may be more positive news to come for investors of the company.
Termination of Merger Deal
The announcement of the stock buyback and dividend increase came after the termination of a merger deal with hedge fund Standard General. The merger deal, which was agreed upon last year, was terminated due to regulatory issues. The deal was expected to close on February 22nd, but was unable to satisfy the closing conditions.
Surge of Shares
Shareholders of Tegna Inc. reacted positively to the news of the stock buyback and dividend increase, as well as the announcement of the return of additional excess capital. Shares rose 2.4% after hours and continue to climb.
Tegna Inc.’s announcement of a $300 million accelerated stock buyback and increased quarterly dividend, as well as the review of the return of additional excess capital, led to a surge of shares after hours. This news is a positive sign for investors of the company and indicates a strong financial position.
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